Be careful what you wish for

We all recall ,,The Arab Spring'' and the Encouragement which was offered, particularly by Secretary of State Hillary R. Clinton to the Forces which toppled Regimes in Tunisia, Egypt and Lybia.  Traditionally, some Long Term Thinking and Analysis of what the Consequences might be when one undertakes a particular Course in Foreign Policy are indispensable.  Many Historians and Political Scientists compare Foreign Policy to a Game of Chess, where thinking several Moves in Advance is essential.

Thus, the Statement reported to have been made today by Egypt's relatively freshly elected President, Mohamed Morsi is quite insightful, we believe:

In a speech that was by turns defensive and conciliatory, he ultimately gave no ground to the critics who now were describing him as a pharaoh, in another echo of the insult once reserved for the deposed president, Hosni Mubarak.

“God’s will and elections made me the captain of this ship,” Mr. Morsi said.

 

(as reported by The New York Times - Emphasis added)

Full Article:

http://www.nytimes.com/2012/11/24/world/middleeast/amid-protest-egypts-leader-defends-his-new-powers.html?nl=todaysheadlines&emc=edit_th_20121124&_r=0
 

 

Traditionally, Secretaries of State have been notably apolitical.  A Secretary of State strived, sometimes more succesfully than at other Times, to further the Interests of the United States to be served for the current and future Administrations, regardless of which Political Party were to come into Power.  Secretaries of State did not harbour Presidental Aspirations.

 

However, all this Amalgamation of Developments in the Middle East already combined with Talk about ,,2016'' and how long Mrs. Clinton will stay on the Job as Secretary of State after having announced her Announcement to leave, for so long and so many Times, might be Ground for one to give thought to the Adage:

 

,,Be careful what you wish for.''

 

To this, we should consider the Thought that Events in Syria and Gaza, not to mention Iran, Iraq, Afghanistan, Pakistan and even Turkey, are still unfolding.

The Danger of War

Fifty Years ago, if one were to ask someone on the Street, be it in New York, Washington, Moscow, Paris, London and, yes, probably even in Beijing (then referred to as Peking or Pekin), People would have said, most likely, that the greatest Danger of the Possibility of a War comes from Berlin.  There were good Reasons for this Line of Logic.  Although the Devastation of World War II which killed, according to some Estimates, 45 Million People (25 Million of them Soviets/Russians) in total had ended, there was no Peace Treaty formally ending World War II.  The City of Berlin was divided by a terrifying Wall, Germany was divided by an equally terrifying Fence and East and West (in Europe and in Asia, too) faced each other, in many Spots, through the Barrel of a Shotgun.

As of today, there has still been no Treaty signed formally ending World War II.  Technically, the United States, Russia (as Successor to the Soviet Union), England and France are still at War with Germany, Japan and Italy.  But nobody takes seriously, or even in Jest the Possibility of a Conflict in this Theatre.

In historical Terms, 50 Years is a short Time but in this Span of a little more than 50 Years, the increased and continuing Danger of Conflict in The Middle East has been widening not only in Amplitude but also territorially.  This Conflict which was initially (after the End of World War II) a Conflict basically encompassing the Debate between Israel and the Palestinians has now, under the Banner of Allah and Islam enveloped Iran, Iraq, Afghanistan, Lebanon, Syria, Pakistan, Lybia and, with perhaps more concern that has been accorded until now, Turkey as well.

Ethnically, the Mix is extremely diverse, involving not only Israeli Jews on the one Side but Pakistanis, Turks, Kurds, Persians and Arabs of various Colourations (including but limited to Sunnis and Shiites), to mention just a Few.  Wars costing Hundreds of Billions of Dollars, if not more, severalfold the Cost of World War II have been fought by Western Powers, including but not limited only to the United States.  Is there an End in Sight?  The current Conflict between Israel and the Hamas Faction of the Palestinians casts Doubt on that Hope.

We hear Talk about one Comprehensive Solution after another, grandiose Achievements, even Nobel Peace Prizes but, all these Things have proven, in Retrospect, to be, at best, just Band Aids.

Is there a Solution?  There doesn't seem to be one in Sight.  However, all Sides should think about the Fact that the gradual broadening in these Conflicts, now not just limited to the Israel/Palestinian Situation but also involving Countries, such as Egypt and Lybia which have basically become unstable after an ill thought out Policy of ,,Arab Spring'' pursued by Mrs. Clinton and others has simply succeeded in making the World a more dangerous Place to be.

The Cadence of these Conflicts is so rapid that one Event overshadows another and we can no longer even focus on some of the Conflicts which are still going on.

The Flareup of the Israeli Situation with Hamas in the Sinai Peninsula has just overshadowed Events in Syria where not much Attention is being paid anymore to what is going on.  Earlier, Syria overshadowed the Instability in Egypt and Lybia (where an American Ambassador lost his Life).  The Goings on in those Countries have pushed to the Back Stage whatever may be going on in Afghanistan, where, the Italians have left long ago, the French left this Week and the Germans as well as the British are getting ready to leave shortly.

A Dialogue, a serious Dialogue on what is going on and what may yet develop is indispensable.  We can only hope that the next Secretary of State President Obama will choose, will be more interested in opening and attracting Voices from All Sides to such a Dialogue, rather than ordering a new Airplane and focusing on setting a Record on how many Foreign Countries he or she will be visiting.

Egypt - Nothing to worry about?

It has become clearer and clearer in the last few Days that Mubarak's Departure is imminent. Whether he leaves Today, or Tomorrow or the Next Day, those are the only Things which various Observers and others are debating or seeking to influence. It is also evident, at least to some of us that Egypt is entering Uncharted Waters. Nobody really knows, even if they claim to know, just what a Future Egypt will look like, next Month or next Year.

It is interesting in this Context that numerous Financial Analysts dismiss the Turmoil in Egypt and describe it as being inconsequential, in Terms of the Effect in might have on International Trade and thus, the World Economy. Various Arguments are submitted in support of this Thesis: The Egyptian Economy is very small, Egyptian Trade with the West is limited, there are no huge Egyptian Mega Banks. Thus, the World Stock Markets have continued unaffected, indeed, generally advancing, totally dismissing the unfolding Turmoil in Egypt.

One wonders how many of these Analysts have taken into Consideration the Suez Canal. Acts of Sabotage have been reported both in the Canal Zone and the Suez Pipeline, which is adjacent to it. To the Extent that the Political Instability in Egypt might influence the Safe Operation or, indeed, the very Operation of the Suez Canal, some of these very same Financial Analysts would do well to take notice that the Suez Canal carries, according to some Estimates, nearly 10% of the World Shipping and a very large Proportion of the Oil produced in the Arabian Peninsula. When the Suez Canal had to be closed as a result of the 1967 War, it remained closed for 8 Years; the Consequences on World Trade, particularly Oil Trade were enormous.

The other Danger, which these Financial Analysts appear to ignore and pay no Attention to or indeed, even discuss, is the much spoken 'Domino Effect' which transferred from Tunisia to Egypt and may be headed elsewhere, to places such as Jordan or Yemen. While neither Jordan or Yemen are Oil Exporting Nations, the simple Likelihood of Instability, however slight, in the Arabian Peninsula Region is something which perhaps should not be too easily dismissed. Finally, nothing is known about what Effects all this may or may not be having on Saudi Arabia, a Giant Oil Producer and also a Country where, according to some Reports, a certain Form of Slavery is still legal.

The Question behind this Article is to ask what Kind of Logic is driving the Positive Outlook of the Stock Market Averages, in view of this Onslaught of very worrying News. The underlying Question to that Question is, that if one assumes the Obvious, that Financial Markets can only be driven by Money, i. e., more Money flowing in than flowing out, then to what Extent the Policy of the Fed's 'Quantitative Easing' is fueling all this. It has been noted many, many Times before; Markets only go up when more Money flows in than flows out; that particular Law of Mathematics has not yet been repealed.

This should bring us down to taking a Look at some other Fundamentals: Jobs, Housing/Mortgages and Health Care. Mr. Bernanke testified before Congress on 9 February and spoke about the Dangers of the horrendous Federal Deficits but seemed to be little concerned about 'Quantitative Easing' which, although it carries a different Mathematical Symbol than the Federal Deficits before the Numerals, it has the same Effect as Deficit Spending, meaning, Cash Out. It would be useful to know, it would seem, therefore, just how much of this 'Quantitative Easing' Cash Out is finding its Way into Financial Markets, whether managed or coincidental and what the overall Effect on the Economy that would produce, if indeed that is the Case.