The four office towers of the World Financial Center in downtown Manhattan are directly behind Ground Zero, overlooking it from the West.
So on Friday, since I was about a half hour early for a meeting at one of the towers, I figured I’d walk full circle around the Ground Zero cavity.
The walk is about 12 city blocks. Stopping and starting, it took me about 20 minutes. And it prompted some thoughts I want to share with you this morning.
But brace yourself. In Friday’s cold New York winds, my thoughts spanned tens of thousands of miles, including a chain of events that could have a dramatic impact on your daily life …
AN UNFINISHED WAR
On Church Street, to the East of the cavity, I stopped briefly before the memorial photos, and my mind flashed to the war in Afghanistan.
I remembered how, a few weeks after 9/11, when the Taliban defiantly refused to turn over Osama bin Laden, the U.S. and its allies began air strikes against Afghan military installations and terrorist training camps.
I also remembered how five weeks later, with the help of U.S. air support, the Northern Alliance managed to take the key cities of Mazar-i-Sharif and Kabul with breathtaking speed. And I recalled how on December 7, the Taliban regime collapsed when its troops fled their last stronghold in Kandahar.
But today, nearly two years later, the Afghan war goes on. New battles are breaking out among warlords that still hold key regions. Just this past Friday, around the same time as I was pacing around Ground Zero, an American Special Operations soldier was killed in Northeastern Afghanistan, the first since hundreds of U.S. troops were deployed to that mountain region. And yesterday, a UN worker was killed in Kabul.
MORE WARS
I walked down Vesey Street and stopped again to peer into the deep pit. My thoughts turned to Iraq, another war that we once thought was over, but has now become a full-fledged guerilla war against allied forces. I won’t go into the details. You see and read them every day.
What you may not hear about very often, however, are the many other wars, often with similar ideological underpinnings, that have been raging for years, even decades — in Chechnya, Sri Lanka, the Philippines, Indonesia, and dozens of other hot spots. You may not hear about these every day, but the fact is THESE ARE WARS THAT DO NOT DIE EASY. They go on and on.
The Kashmir conflict is a case in point. It has caused 40,000 to 80,000 deaths locally plus two wars between Pakistan and India. After decades of slow build-up, it now appears to be moving into a more advanced stage, as evidenced by stronger-than-usual local support for attacks and kidnappings that have just taken place in the past few days.
And never forget the Levantine — the region that encompasses Syria, Lebanon, Jordan, Israel and the semi-state of Palestine.
The Levantine is the locus of the Intifada (Palestinian rebellions) and three wars against Israel. The Levantine harbors the Hezbollah, Islamic Jihad, and Hamas, the radical faction of Fattah. It is the epicenter that continually pours forth the religious, ideological and emotional drivers for many of the terrorist attacks and battles that have recently erupted around the world … or are about to erupt soon.
Until recently, the majority of these conflicts seemed subdued or suppressed. Or they had simply failed to rise to a level of significance that might dent the powerful economic growth engines of the industrial world.
Now all that appears to be changing. Now, the conflicts seem to be approaching critical mass, and they are bound to have a far greater impact on our economy and on our daily life than most people expect.
So no matter how tired you may be of the drumbeat of CNN or Fox news, night after night, you can ignore this danger no more. You must sit up, listen and recognize it for what it really is: Not just a worldwide war on terror … but also a terrorist revolution against the West.
NEW FRONTS EMERGING
Just two weeks ago, another front was declared in the spreading world conflict — this time with a second major suicide bombing in Saudi Arabia, by far the largest single source of the world’s most critical energy resource, oil.
Then, about 48 hours ago, in Turkey, two truck bombs exploded outside a pair of synagogues crowded with families, killing at least 20 people and injuring more than 300. Turkey, straddling the foot of Europe and the mouth of Asia, is still ANOTHER front in the worldwide war/revolution.
Plus, many more new fronts are now possible, if not likely:
* THE REST OF THE ARABIAN PENINSULA, including oil-rich Qatar, the base of U.S. operations in the second Gulf war … oil-rich Kuwait, oil-rich Bahrain, oil-rich Oman, and oil-rich United Arab Emirates … plus Yemen, a traditional base for the peninsula’s most radical militants.
* CENTRAL ASIA, including not only Chechnya, already decimated by two wars, but also the former Soviet Republics of Azerbaijan, Turkmenistan, Uzbekistan, Tajikistan, and Kazakhstan.
Kazakhstan alone, the ninth largest country in the world and almost the size of the Continental U.S., is a rich source of petroleum, copper, lead, zinc, silver, cobalt, gold, iron ore and coal. But much of its predominantly Muslim population is angered by the corruption and nepotism that has overtaken the government in Alma-Ata, the capital.
Indeed, just last month, the new president, Ilham Aliyev, succeeded his own father, the former president, in an election widely believed to be rigged from start to finish.
* Plus, there’s NORTH AFRICA, stretching from Morocco in the East to Egypt in West. Each of the five North African countries bordering on the Mediterranean harbors strong radical Muslim movements, with the possible exception of Tunisia. All five could soon be engulfed in the war/revolution.
MULTI-DIMENSIONAL, MULTI-CULTURAL FISSURES
Most people, including many experts in many governments, think about these far-away conflicts in just one dimension: Radical Muslim movements. Anti-American or anti-Western fervor. And Violence.
In reality, they stem from multi-dimensional, multi-cultural fissures, and many of these fissures have already ruptured … or seem about to do so soon.
The most critical fissure is ECONOMIC. With a few notable exceptions, corrupt, filthy-rich despots, monopolists and oligarchs control most of the wealth in North Africa, the Middle East, Central Asia, Indonesia and the Philippines. Even in the richest of them all, Saudi Arabia, thousands of royal princes have a lock hold on the most strategic positions in government, commerce and industry.
At the same time, throughout these regions, desperate, downtrodden urban and rural poor have little or no access to adequate housing and modern sanitation — let alone good health care or education.
Another major fissure is CULTURAL. The elites are modern and Westernized. The masses are not. Yes, in some countries, middle classes are struggling to emerge, but in most areas, they are not yet a significant factor.
A third fissure is RELIGIOUS. Islamic fundamentalists clash with more moderate Muslims, and both clash with Christians, Jews, Hindus and agnostics. Even as far East as the island of Mindanao in the Philippines, Muslim fundamentalism is the primary ideological tool used by militants and insurgents to recruit members.
The fourth is HISTORICAL. The protagonists trace their conflict through millenniums of battles, wars and massacres. Using a mix of historical fact, legend and myth, they build a pseudo-moral case for revenge and martyrdom.
The fifth and most frightening fissure is MILITARY. Virtually all of the hot spots I’ve told you about are akin to armed camps. That includes established regimes armed to the teeth. Plus it includes ubiquitous stashes of dangerous weapons outside the control of the authorities — in hideaways, places of worship, homes, even schools.
DANGEROUS ALIGNMENT
The wind seemed to blow more coldly as I left the protective barriers of Ground Zero behind me. I remembered that all these conflicts and fissures have been with us for many years. So what has changed?
It’s simply this: In the past, each fissure was on a different plane, with differing consequences, occurring at different times. Now, the globe seems to have rotated in such a way that the fissures — and the anger they generate — are coming into dangerous alignment.
You see, each of the lines of conflict — the vast economic chasms, the deep cultural voids, the wide political divisions, the die-hard religious hatreds — are coming into synch along one axis and with one by-product: VIOLENT CHANGE.
Plus, we also see alignments and alliances of a more tangible variety: The United States and other major powers, despite their differences, are cooperating more closely in their battle against terror. At the same time, terrorist forces also seem to be forming their own links, with more coordinated attacks worldwide.
Each side, in turn, seems to be gaining more support from key segments of society — the more modern elements usually (but not always) supporting the status quo … the more traditional elements typically (but not always) cheering on the terrorism and revolution.
THE IMPACT ON YOUR DAILY LIFE
Ultimately, I am an optimist. I am confident the proponents of violent revolution will lose, just as they did after the fall of the Berlin Wall and the meltdown of the iron curtain. But in the meantime, the economic growth and progress of modern society will be severely challenged.
Exactly where will this ultimately lead us? I wish I had the answer, but I don’t. No one does.
I CAN tell you though, how it could affect you right now …
FIRST, INFLATION. The global conflicts could disrupt the supply of critical commodities we need in our daily life. Energy for our autos and factories. Copper for offices and homes. Not to mention foods — wheat, corn, soybeans, sugar and more.
Already, even before any significant supply disruptions, most commodity prices have surged in recent months. Reason: Governments all over the world are pumping up the demand for commodities with liberal doses of paper money and ridiculously low interest rates.
Result: Already, in this country, we are witnessing a jump in the prices that manufacturers and other producers have to pay.
In fact, just this past Friday, the U.S. Department of Commerce announced that U.S. producer prices jumped by 0.8% in October. If this continues for 12 months, it will imply a producer price inflation of 7.6% — a huge upward swing from the 2% DECLINE in producer prices we were witnessing just one year ago.
And if the monthly rate of increases goes just a few ticks higher, producers may suddenly find themselves face to face with DOUBLE-DIGIT inflation.
No matter what, expect to pay more for gas at the pump, for electricity, and for a wide variety of consumer goods. But beware: Housing prices are still a bubble.
SECOND, A RUSH TO SAFETY. As the world increasingly becomes more dangerous, the migration by investors from relative risk to relative safety is bound to be ongoing and massive. That will make it awfully difficult for stock investors to make money in the years ahead.
The primary long-term winners: Those investing very selectively in gold, energy, natural resources and other non-traditional investments … plus those with the patience to wait for true values in other sectors.
THIRD, A DISLOCATION IN U.S. POLITICS. As wars rage in Iraq and elsewhere, and as the presidential election campaigns heat up, the American political landscape is becoming more polarized.
The right wing, driven to win the wars, is gaining ground in many Republican circles.
The left wing, driven to stop the wars, is gaining ground among Democrats.
And the once-dominant center, which might seek to unify the country despite any wars, is shrinking in influence as it gets squeezed between the pro- and anti-war forces.
Regardless of your political persuasion, you must accept the fact that this polarization is a natural outcome of war … and that it could be a serious destabilizing element. It raises the specter of more frequent changes of power in Washington, and it could bring rougher transitions from administration to administration.
Plus, it engenders more desperation by politicians — whether Democrats or Republicans — to spend their way out of political or economic trouble, driving our country’s finances deeper into the gutter.
It augurs for dirtier politics, bigger deficits, more inflation and sharply HIGHER INTEREST RATES. There seems to be no other alternative.
Silver lining: Higher interest rates also give you the opportunity to EARN higher yields — provided you build your savings and you don’t make the mistake of locking in today’s record low interest rates.
OVERALL, the spreading worldwide conflicts threaten to throw our future into a sea of uncertainty. And for this, there is truly only way to prepare:
Don’t get caught up in euphoric booms and busts.
Keep your money and investments safe.
Stay liquid and flexible.
And be healthy.
Good luck and God bless!
Martin
Martin D. Weiss, Ph.D.
Editor, Safe Money Report
Chairman, Weiss Ratings, Inc.
martinonmonday@weissinc.com
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