Saudi Arabia

What happens when you poke a Russian bear?

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As written earlier in the week, regardless of one’s views on the righteousness of any attack on Syria, Putin is being faced for the first time in a long time, a leader of a foreign nation (nations as it turns out) prepared to stand up to him. Obama fled the Syria battlefield after being given a two hour window when Russia first went to the aid of Assad. If that wasn’t the ultimate sign of a bully in the Kremlin it is hard to think of what is. While sanctions may have bitten to a degree post Ukraine and the shooting down of a Malaysian Airlines flight, Syria is essentially a testing ground for Putin to weigh up Western (specifically Trump’s) resolve. If we look at Russia’s response post the Syrian strike,

The worst apprehensions have come true. Our warnings have been left unheard…A pre-designed scenario is being implemented. Again, we are being threatened. We warned that such actions will not be left without consequences…All responsibility for them rests with Washington, London and Paris…Insulting the President of Russia is unacceptable and inadmissible.

Kind of says it all really – Russia hasn’t been insulted. Putin has. He must have a glass jaw  like Trump! Two bullies flexing muscle. In a show down Should Putin wish to pick a direct conventional fight against 3 nuclear powers (explicitly mentioned), he knows that ‘mutually assured destruction’ is the very last option in the drawer and next to no chance of being selected despite all of the media beat up. On a conventional basis, Putin wins more battles by stirring up the hornet’s nests in other regions. Lending more support to Iran, Lebanon and Yemen. Destabilize Saudi Arabia and antagonize Israel.

CM wrote,

It is worth nothing that Syria is Rosoboronexport’s (Russia’s military export wing) 2nd largest customer after Iran. Putin is sick of having the West try to remove his clients. Assad is key to Russia’s foothold in the Middle East. With an essentially pro-Iran Iraqi government and Syria as well as Hezbollah Putin has a geopolitical doormat from the troubled separatist states to Russia’s south to Lebanon.

Some arguments have been made about the risks of the American, French or UK strikes killing Russian troops or civilians on the ground in Syria handing Russia free will to attack its enemies. Scroll back to November 2015 when the Turkish Air Force shot down a Russian Su-24 fighter it claimed entered its airspace. Two Russian pilots were killed in the shooting and subsequent rescue. The Russians were incensed but President Erdogan is still in power and Ankara isn’t flailing after seeing its capitol turned into smoldering rubble.

This argument that the Russians weren’t given advance warnings of the attack is ridiculous. Had the Russian defence forces been on proper alert (they most definitely weren’t passed out behind their radar screens after a vodka binge) they would have detected the missile launches. Wind back to the 59 missile launch earlier last year against Syrian chemical facilities. We didn’t hear a peep from Putin. Why now? Of course he is incensed over the booting of diplomats on the nerve agent scandal but this is a showdown of ego.

Think of the long geopolitical chess board here. Should Trump have backed down on Putin’s threats, wouldn’t China’s Xi feel equally empowered to annex Taiwan by telling POTUS that he risks ‘grave reprisals if he meddles with Chinese sovereign territory’?

For all the initial snubbing of Trump by Macron on his historic election win in France, there is no way he would have gone in alone to attack a chemical facility without the guarantee of the military might of America. It is unlikely Theresa May would have done it either. So for all of the ‘unhinged’ lunatic rhetoric bandied about by the media, foreign nations don’t gamble their own sovereignty lightly, especially over something like Syria.

General Mattis has said they plan no further strikes at this stage. Does Putin order his forces to sink a US destroyer in the Mediterranean which launched those missiles? Highly unlikely. He does have the best weapon available to do that (the ‘Sunburn’) but sending US naval vessels to the bottom of the sea on a strategic strike would seem a big response to a targeted hit.

Let there be no mistake. There is a new sheriff in town. Russia has a bloody nose it didn’t think it would find itself. Putin miscalculated that Trump isn’t all Twitter-fueled bluster. Uncertainty in foreign leaders is always a risk for enemies. Trump has shown Putin he won’t be bullied like his predecessor.

Putin doesn’t want a hot war with America. The best way to strike at the US is like the last 6 decades. Undermine her at every opportunity. Supply her enemies. As mentioned before, if the Russians didn’t think it worth hitting back at Turkey for deliberately targeting its fighters, it is unlikely that Putin, no matter how ‘insulted’ he might feel will take a strike not aimed at Russians as a pretext to pick a fight with Trump. Putin has worked out the US president’s measure. He miscalculated. He won’t make that mistake twice.

For the media, running all the scare campaign stories is not only highly irresponsible (as it did over Yemen’s attacks on Saudi Arabia) but proving the lack of depth of analysis. They can beat Trump over the head all they wish but should note the actions of Macron and May following him into the region as a tacit approval of the US leader. Was he the madman they portrayed him as in the first place they would have stayed well out of it.

Watch for Putin’s response (unlikely but will threaten it will come when the evil Americans least expect) and think deeply about why it is important that the real despots (Putin, Xi, KJ-U, Erdogan) around the world no longer have the ability to exercise free will in knowledge that the worst they face is a slap on the wrist from the UN.

Sounds more like grounds for congratulation than censure. 

World on the brink of WW3? Press on the blink more like it

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When you read a title like “world on the brink” it is easy to be misled to thinking this is a Trump/Putin related incident. The fact is the Iranian backed Houthi in Yemen have been lobbing ballistic missiles at Riyadh and staging border skirmishes for years. The Americans have been advising Saudi Arabia where to strike the Houthi in Yemen. This is a decades old fight and since the death (assassination) of former President Saleh last year the Houthi have become even more emboldened than they were during the Arab Spring 8 years ago.

Yet it is so easy to draw conclusions. Did the mainstream media report the sinking of a Saudi naval frigate in the Bab-al-Mandeb strait in Jan 2017 which took the lives of 176 sailors? Has the Israeli shekel collapsed since Trump and Putin exchanged verbal salvos? No. The Tel Aviv indices? No. Surely a relatively liquid financial barometer in a country that has been warned not to intervene by Putin too. Would quickly price in any fears.

The situation over Syria may be tense but if you look at what Putin is really trying to do he is weighing the size of Trump’s guts to call his bluff. We shouldn’t forget when Russia first intervened in Syria several years ago, Putin told Obama that US forces had two hours to get out of harm’s way. That is the warning one would give the Luxembourg armed forces, not the most powerful military in the world. Obama heeded Putin. Putin had carte blanche. That’s why nothing happened with the Ukraine. Sanctions were put in place but no one made any attempt to ‘change behviours.’

It is worth nothing that Syria is Rosoboronexport’s (Russia’s military export wing) 2nd largest customer after Iran. Putin is sick of having the West try to remove his clients. Assad is key to Russia’s foothold in the Middle East. With an essentially pro-Iran Iraqi government and Syria as well as Hezbollah Putin has a geopolitical doormat from the troubled separatist states to Russia’s south to Lebanon.

The problem Putin faces is if Trump yanks his chain, does he shoot US missiles down as threatened? He said they’ll attack launch sites which effectively equals sinking US naval vessels as that is how they are launched. This is perhaps the easiest way to escalate a skirmish out of Putin’s control. If Putin doesn’t do anything, Trump holds one over him. So Putin is hoping by the use of very strong language that Trump backs down. It is not exactly the best way to handle on either side but this is the first time in almost a decade where the US has a leader that won’t be pushed around. Unpredictablity is a strength not a weakness

Looking at history. The NVA was supplied by the Russians during the Vietnam War and the Afghans were supplied by the Americans in the war with Russia. Nothing new. The Russians returned the favour when the “Coalition” deposed Saddam and entered Afghanistan. Proxy wars have been fought for over 50 years.

The US is dispatching a carrier battle group to the Mediterranean. Theresa May is sending a UK submarine. The Russians are conducting military exercises with 11 warships in the same area. Of course scare stories are amock and clickbait media will report how we’re two seconds from a thermonuclear exchange.

It begs the question had Obama suggested to Putin he was bombing Syria, he would be praised for level headed genius. If Trump managed to bomb Syria with no Russian response then would we see the media have a mea culpa moment? Not a chance. It would be palmed off as a lucky break. If we go back in history, we can see good nations that did nothing let tyrants get away with murder. Have a look at Russia and China in the last decade. Man made military bases in territorial waters of other nations, early warning systems on the contested  Spratly’s and agreements in Vanuatu and Sri Lanka which provides naval ports for China. Putin is getting the old ‘union’ back together and there are plenty of willing despots happy to ride his coattails.

Putin is livid at the outcome of the nerve agent scandal seeing the expulsion of so many diplomats. He is not one that likes criticism as many an oligarch has found out the hard way. The question for those that fear what Trump might do should worry more about what will happen if he doesn’t. The downside is that the media likes Putin more than Trump. For a president with a glass jaw, his moves will be far more heavily scrutinized than Putin’s. He’s damned whichever way he turns. Putin on the other hand  willl be excused for being a dictator, whatever he chooses to do. The media will hope it dies down as they turn a blind eye and pillory their own governments for not taking in enough refugees.

Appeasement is an ever widening feature of governments in the West today. There are Neville Chamberlains everywhere. Who will stand up to Putin if Trump doesn’t? Whether Syria is the right battleground is beside the point. Because if it isn’t Syria it will end up being somewhere else.  The problem is only Trump “can” credibly shirt-front the former KGB officer.

 

True colours of the left exposed when it comes to white Sth African farmers

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There is something to be said of the left when it comes to compassion. For all of the sanctimony of how we must do our bit for social justice and fight to stop every -ism in the world, whites need not apply. It shouldn’t have escaped many that certain “white” South African farmers are fleeing persecution while their land is being confiscated. Murders, beatings of men and women, children having their faces given the “joker’s cut” with razor blades. It’s truly horrific. Yet some are prepared to cynically fire off “the poor whites…”

Yet because of their skin colour some on the left deem their “white privilege” should be checked first. It would seem in order to restore justice, white South African farmers should get a taste of their own medicine after the oppression of apartheid some 30+ years ago. Surely people in need are indeed just that – in need. Are all white farmers guilty of apartheid? Back of the line. Sacrifice your lives for the sake of equality.

Australia is often beaten over the head for its asylum seeker policies. That somehow asylum seekers kept in detention centres (where they demand Hyatt 5-star  services and amenities) awaiting processing on Manus Island got a raw deal as ‘fellow whites’ get a fast pass. What the media, like The Guardian often fail to do is report the balance. Immigration Minister Dutton fast tracked the visas of 700 Yazidi women who had escaped ISIS rape gangs. They aren’t white. They were in grave danger. Instead of congratulations it wasn’t reported.

On the flip side 12 Iranians had their visas revoked by Dutton’s office for lying in their applications. They had pleaded they were fleeing persecution in Iran yet the first thing they did on receipt of visas was to fly back to the very danger zone they had escaped for a holiday. Was that racist policy or one that is simply preventing visa fraud to ensure integrity in the immigration system?

Asylum seeker policy is a touchy subject. How Angela Merkel was praised for her social caring programme by granting a come one come all refugee policy, one which ended up being the mother of all misguided altruism. Instead of helping the truly needy, the EU tallied that 80% were economic migrants seeking better fortunes in the West. That’s right 80% weren’t fleeing war zones.

Since she started her benevolence, Merkel gagged the media, muzzled the police and silenced those that spoke out about the cover up of the deterioration in public safety, rapes and crime which even now Merkel admits has led to the creation of no go zones which never existed before. She’s now paying for refugees to leave with generous incentives. Yet where is the left’s media outrage? Why not just admit it was a dreadfully executed policy which cost her the worst election result for her party in 70 years and gave the anti-immigrant AfD the second largest following in Germany from nowhere?

Then the folly is extended to the EU which then tried to cover up for Merkel by enforcing migrant quotas like they were cattle. Asylum seekers were mostly making a B-line to Germany yet the EU in its infinite wisdom thought all members had a duty to take a share. If they truly spared a thought for asylum seekers, why would any wish to be allocated to countries like Hungary that held a referendum on the topic and got a 98.4% response against having them? Not a promising starting point.  Then we sit back and wonder why the Italians voted for anti-immigrant, eurosceptic parties? Or why the UK voted Brexit? Or why the Austrians also voted in a government that put a right wing anti-immigration party in charge of immigration? Or The Netherlands? Poland? Hungary? The list goes on.

Yet the media focuses on a drowning 3 year-old boy on a shoreline and tried to shame our collective lack of compassion. Still the media refused to focus on the billion dollar illegal people smuggling industry that lured so many who weren’t fleeing persecution to their deaths. That poor little Aylan Kurdi died, not  because he and his family were fleeing  to safety (they already had been for 3 years in Turkey) but that his life was put at risk without a life jacket in a flimsy vessel for the sake of his father’s own dental treatment.

Why not beat Gulf states over the head for not doing their bit? The Saudis can accommodate 3 million, chair the UN Human Rights Council yet refuse to step up and the media stays silent. Why not smash up Japan for letting in low double digit numbers of asylum seekers? Is it a coincidence that the 98% homogeneous society has such low crime rates, social harmony and safety record the envy of the world? It is not to say that foreigners commit most of the crime in Japan because they don’t (per head of population they do) but Japan is not prepared to throw its culture out the window to get with the times on doing its bit for humanity. Japan would prefer to throw billions in foreign aid to fix the problem at source.

The better narrative is to pick on the West. Shame our white privilege. Mock our colonialist past and tell South African farmers to go to hell.

Compassion for the truly needy should only depend on the danger faced. Skin colour, religion, sexual orientation or any other identity based criteria should be irrelevant. People who are desperately fleeing for their lives should fall over themselves to willingly respect the rules of their new house. They should be only too happy to repay the generosity of those that provide safety and strive to become model citizens. Many Vietnamese fleeing the ravages or the Vietnam War have paid back our support in spades.

Yet too often those who have not escaped persecution end up being the ones that expect society to bend to their culture not the other way around. Our authorities and judiciaries are becoming self annointed justice warriors often turning a blind eye to crime by meting out lenient sentences for armed robbery, rape, child grooming, assault and manslaughter with paltry community service orders. Take this example. Ibrahim Kamara, from Sierra Leone, received a suspended sentence of just over one year, with an 18-month good ­behaviour order, after admitting to five counts, including grooming and having sex with a minor. The ACT Supreme Court judge said “(Kamara) has tried to make a good start on his life in Australia”. Or last week a Sudanese woman, Ayou Deng, was given 80 hours community service for running over and killing a 13yo boy in a car she was driving unlicensed. What message is being sent to the people that we would hope want to integrate in the great Aussie way of life? Do what you please as the worst you’ll get is a slap on the wrist.

Then should we criticize Australia’s asylum seeker policy when we ask for the recipients of asylum visas to sign a code of conduct order which explicitly tells them that rape and sexual harassment of women and children is not accepted? Surely civilized society shouldn’t need to have to force new arrivals to sign a document for common decency but apparently they do. Clearly the immigration department saw it as a requirement supposedly to stem the tide of countless incidents before it was introduced. Then again Canada is trying to remove female genital mutilation from its new citizen’s code of conduct for fear it might offend. You can’t make this stuff up.

So to the left that wants to selectively administer asylum seeker policy based on prejudices. In the quest for diversity they should check their own hypocrisy before asking white South African farmers to check their privilege as they cry for genuine grounds for asylum. The true colours of the left are exposed for what they are. Institutionalized diversity folks is anything but. No one wins acceptance by denying their own identity,

Why is Merkel pushing for a coalition when a caliphate is for the taking?

Why is Merkel bothering trying to form a fragile coalition when she can submit to a caliphate? To be honest seeing this video of a German state run children’s TV channel with two white, blonde Germans submitting to Islam doesn’t surprise. Such is the growing level of indoctrination to make up for the cataclysmic failure of Merkel’s misguided altruism that the state doesn’t even bother to hide it anymore. Is it any wonder that the AfD is 14% of the vote? People are increasingly growing tired of the political correctness yet the authorities in Germany are ever more willing to charge citizens for what the state deems as ‘hate speech’. Politically motivated violence is up 30%YoY in the last two years.

To try to brainwash young kids to accept a growing Muslim population is one thing, getting them to submit to it is outrageous. How naive is the left to think that this is in anyway normal or going to wash with large parts of the population? If they believe in preaching tolerance to young kids why aren’t they looking to form an alliance with a Saudi TV station to help kids In Riyadh to submit to Jesus Christ? For the left spineless submission and shared misery are seen as a virtue. Their Marxist view is that acceptance can be won by denying the national identity.

Promoting tolerance is one thing. Indoctrinating it is another. Germans are a socially conscious people but there comes a time when they feel that their generosity is being taken for granted. When that support requires them to make adjustments to the ways they have practiced culture, dress or community for centuries they have a right to a proper explanation rather than face the threat of the courts.

Go back several years when we witnessed the aftermath of the Cologne sexual assaults on New Year’s Eve. The police and press were muzzled. However after the incident could no longer be concealed, the Mayor of Cologne came out and openly asked women to dress more appropriately to avoid being harassed. Think through the logic. German citizens (more specifically females) must take extra precautions around the very people billions in taxpayer euros are going to support, moreover save them from their desperate plight? Of course not all refugees are responsible for the 64% jump in foreign crime reported by the Interior Ministry (BfV).

Ask why as of June 2016, there were 402,301 small arms carry permits in the National Weapons Register according to the BfV, some 50% higher than that recorded in June 2015? A coincidence that more Germans are feeling ill at ease with Merkel’s social experiment?

While every effort should be made to accomodate those fleeing from persecution and war zones, propaganda videos to brainwash innocent children like this only accentuate the depth of the problem faced by Germany.

Such is Merkel’s folly the EU confirms that 80% of these seeking asylum are economic refugees so much so that she is now pushing a scheme dubbed “Your country. Your future. Now!” which will run until February this year. Individual migrants can receive up to €1,000 if they voluntarily return home, while families can receive up to €3,000 to do the same. The assistance is meant to help reintegrate rejected asylum seekers in their home countries. The refugees, which were unsuccessful in their applications, could also get subsidized housing for a year—to help pay rent, home renovations, or get basic equipment for a kitchen or a bathroom.

Await the excuses that will come out assuring Germans that the children’s TV program was merely a drama and not to be taken as a mainstream view. Common sense will tell us that this is not the last time we will see such media pushed on the local population to force diversity to cover for dreadfully planned policy failure.

Let’s await the June 2017 small arms carry permits statistics to see whether the people are in tune with the view of the state.

2018 – no more space for multiple ‘elephants’ in the room

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The Contrarian Marketplace wishes everyone a Happy New Year and prosperous 2018.

As oft the case people are busy making new year’s resolutions. CM mission doesn’t change. It aims to further energize the spirit of enquiry. To be the maverick voice that will not be silenced. We live in a world where we need to become comfortable being uncomfortable. We can no longer hide behind group think Because we feel it is dangerous to challenge consensus views. CM won’t buckle to identity politics, victimhood or social justice.

However that will never exclude us from criticism and we welcome feedback to improve the offering. We will not take The Guardian approach of refusing to acknowledge the content might be the problem when appealing for readers to ‘donate’. CM is self funded. It will remain so because it never wishes to be beholden to others to peddle tailored messages to keep the lights on.  If CM doesn’t survive on its own merits then it dies through market forces.

In 2017, Brandon Tatum showed what impact a Tucson, Arizona police officer can have on today’s media. His videos have gone viral (50mn+ views) on topics from the NFL, BLM to anti-Trump protests. He is now working for the Conservative Tribune such has been his impact. He speaks in cold hard truths. One doesn’t have to agree with what he says but he makes compelling arguments. No accolades from the journalist associations to self congratulate. As we used to say at high school sports competitions- “look at the scoreboard.”

CM started two years ago to challenge conventional thinking on all manner of topics.  It was born out of a growing realization that the mainstream media on both sides of the fence was too biased. Investigative journalism has all but disappeared, replaced with clickbait headlines and little more than biased piffle for what can only loosely be described as content. It seems that journalists are paid on the number of shares or likes rather than the quality of input.  As Ariana Huffington once said, “I’ve long said that those of us in the media have provided too many autopsies of what went wrong and not enough biopsies.”

2017 has been a continuation of the ridiculous pandering to political correctness and our lawmakers seem even more determined to avoid censure from social media, somehow thinking it speaks for the majority. Gender neutral toilets, removing statues and same-sex marriage take priority to the oncoming fiscal/monetary train wreck and a fracturing geopolitical landscape. It is almost as if our elected leaders have the blinkers on.

2018 is shaping up to be one that our political class is ill prepared for. Out of one’s depth is not a harsh enough criticism. Too many governments (including conservatives) are running up the national credit card trying to bribe bewildered constituents into tolerating more of their nonsense. However at some point, appeasement will not work because government’s can’t economically afford it.

Silent voices are increasingly pushing back. Traditional parties are seeing their constituents abandoning them. Australia’s conservative Liberal Party is Exhibit A. It is no longer a party true to its core. After the Turnbull coup it has taken its constituents for mugs but they have left in droves. While the Libs champion superior leadership, how is it One Nation has taken a huge bite out of it’s support base? It doesn’t add up and its this sense of denial that guarantees they’ll be destroyed at the next election.

Look at the growth in nationalist parties in Austria, France, The Netherlands, Germany, Italy and even America. While they may not have outright majorities in every case the reality is that all of these parties surged in the most recent elections. Mainstream parties can mark it down as a one-off or ‘they’ll be back’ mentality but this time is different. Take Trump. His GOP hate him almost as much as the Democrats. While the mainstream media ties itself into knots over the relevance of well done steak and tomato ketchup to running a country or the fact he paid millions in tax, his brand of political incorrectness is refreshing.

Sure his words are vulgar at times and Obama knocks the sports off him for eloquence or as a nice guy but we are in a world of ruthless people. The geopolitical landscape is rapidly changing. The last US administration allowed a free-for-all for nations such as China and Russia to roam free on the global landscape. Russia’s actions in the Ukraine, Syria and Iran or China building man made military bases in contested Asia-Pac waters have filled a vacuum vacated by the US. We should be glad that we have a Trump who is putting his foot down that things have changed.

While Trump’s use of ‘Rocketman’ to describe North Korea’s leader may seem juvenile, China hasn’t fully worked him out. They stroked his ego by allowing him to be the first President to dine in the Forbidden City after his rhetoric saying that if they don’t deal with Kim he will. The resumption of Chinese oil trading with North Korea in full defiance of UN sanctions tells two things. China thinks the UN is a waste of space and it is testing Trump’s resolve to carry out his threats to take care of business with minor provocations. China’s military is nowhere a match for the US so this could backfire badly if they miscalculate. This will escalate again in 2018.

Don’t rule out India’s growing frustrations with China. China’s built a naval port in Sri Lanka’s Hambantota. Recently the Maldives signed a FTA with China which should be ringing alarm bells in Delhi. For the last decade, China has been strengthening its armed (ground and air) forces to India’s north too, including the funding of the upgrade of the 1300km construction of the Karakoram Highway (aka China-Pakistan Friendship Highway). It is no surprise that Russia has been replaced by the US and UK as preferred arms suppliers to India.

As written several days ago, the Middle East seems to be an unstable powder keg. The way the stars are aligning with respects to the death of the former Yemeni President Saleh, the cleaning of the House of Saud, the repudiation of Qatar by the Gulf states and ructions in Iran point to something larger to kick off. Do not be surprised to see Israel and Hezbollah clash again in 2018. It won’t be an Arab Spring. Afterall this is more a shift toward a more direct clash between Sunni and Shia, not just played through proxy wars in Yemen, Syria or Lebanon. One can’t sink Saudi and Emirati naval vessels off Yemen’s coast with Iranian Revolutionary Guard support indefinitely.

These geopolitical problems will only put pressure on global markets which are already overstretched asset bubbles in almost every form – equities, bonds and housing. The realisation that unfunded pensions are likely to wipe out the retirements plans of millions causing even more pressure on economic growth. There is no escaping the fact that the can has been kicked down the road for too long. Whether 2018 is the precise year it unfolds is still a moot point but we are moving ever closer to the impending financial collapse which will be uglier than 1929.

Central banks have no plausible ammunition left to play with. Bloated balance sheets filled with mislabeled toxic assets (liabilities). Record low interest rates offer next to no policy flexibility and tapped out consumers face oblivion if asset prices keel over. A systemic banking collapse is absolutely plausible. No amount of QE will work this time.

Yes, it would be nice to see 2018 trump 2017 for good news (it wouldn’t be hard) but sadly the punch bowl at the party is empty and the hangover won’t be pleasant. No amount of painkillers will let one avoid a throbbing headache which will last a very long time.

Forewarned is forearmed.

Regime overthrow in Iran? Don’t get too excited (yet)

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The US State Department seems to be openly welcoming the outbreak of spontaneous demonstrations in Iran selling it as the early steps of regime change. In fact it is more likely to help President Rouhani force economic changes he has been prevented from making due to deep seated corruption within the regime itself. Rouhani has tried to make economic changes for years to boost the economy but the regime has kept monopoly power over multiple industries which has impeded his ability to do it.

The Iranian banking system holds 10s of billions of dollars in non-performing loans which is weighing down the economy and undermining the potential for private-sector-led recovery. Given the increasing vulnerability of Iran’s financial system, the government urgently needs to restructure and recapitalize the banks. Iranian banks were weakened by a sluggish economy caused by the sanctions, state interference in lending decisions and lax regulations causing excessive competition with unlicensed financial institutions.

The country’s recovery could well slow since Trump has raised the possibility that sanctions could be reimposed or new sanctions introduced. It should come as no surprise that this has deterred many banks and other foreign companies from operating in Iran.

The Iranian government directly owns and operates hundreds of state-owned enterprises (SoE) and indirectly controls many companies in the private sector. Inflation (9%), price controls (e.g. milk, energy) designed to tame it and rising unemployment (12.4%) are really behind the protests than a direct call to overthrow the Islamic Republic. Still don’t rule out the US State Department rubbing its hands with glee to try to throw a spanner in the works. Easier done by crushing its economy by redeploying sanctions given the financial system is in such a precarious position.

We shouldn’t ignore the timing of the assasination of former Yemeni President Saleh in the last month. His death now gives Saudi Arabia more will to take heavier action against the Iran backed Houthi in Yemen. Now that Saudi Arabia has recently cleaned house with the arrests of royal family members to tighten the inner circle, it almost seems the stars are aligning for the ante to be upped on Iran.

While much has escaped the mainstream media, at the narrow Bab al-Mandeb Strait separating Yemen and Djibouti/Eritrea, multiple US, Saudi and Emirati warships have been attacked by Houthi rebel forces. In January 2017 a Saudi al-Madinah frigate was sunk in the strait. An Emirati HSV-2 swift naval craft was also put out of action in late 2015. Cargo ships (10% of global trade) make their way up the Red Sea via the Bab al-Mandeb Strait to the Suez Canal, could suffer if tensions rise here.

While many are distracted by the decision to move the US Embassy to Jerusalem as an unnecessary ‘in-the-face’ action, most Gulf States want Israel on their side to help them defend against and ultimately defeat Iran. It is only 7 months ago that the Saudis pushed to expel Qatar from the GCC for keeping cosy relations with Iran and supporting Hamas and the Houthi in Yemen. The South Pars/North Dome Gas Condensate field – the world’s largest natural gas field –  is jointly owned by Iran and Qatar which means divided loyalties between the GCC and Tehran.

Get ready for lots of fake news. Something tells CM that there is something more sinister at play.