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World On Fire

The latest Middle East news is right out of ISIS' medieval playbook. But it's not (at least not all) ISIS.

US ally Saudi Arabia apparently decided to start the New Year off by beheading or shooting 47 people, one of whom was a prominent Shia cleric (the Saudis are Sunnis, putting them on the other side in Islam's Catholic/Protestant civil war).

Iran, the leading Shiite power and a long-standing rival of the Saudis for regional dominance, was not happy:

Iran's leader warns Saudis of 'divine vengeance' over execution of Shia cleric

(Guardian) - Iran's supreme leader, Ayatollah Ali Khamenei, has renewed his attack on Saudi Arabia over its execution of a leading Shia cleric, saying that politicians in the Sunni kingdom would face divine retribution for his death.

"The unjustly spilled blood of this oppressed martyr will no doubt soon show its effect and divine vengeance will befall Saudi politicians," state TV reported Khamenei as saying on Sunday. It said he described the execution of Sheikh Nimr al-Nimr as a "political error".

Iranian protestors then set fire to the Saudi embassy in Tehran and the Saudis broke off diplomatic relations with Iran. More, no doubt, is to come.

And that's just one of five or six Middle East conflicts in various stages of combustion.

The ever-industrious Saudis are also bombing their smaller neighbor Yemen back to the 12th century. Russia and Turkey are shooting at each other's assets, human and economic, and sanctioning each other's trade. Based on the rhetoric they're one more incident away from a straight-up war.

Turkey is apparently allied with ISIS and is helping it sell oil on the world market. And the Turkish military is more interested in killing Kurds (whom the US like and support) than in settling things in Syria, where chaos reigns same as always.

ISIS is wreaking havoc wherever it can, staging its own New Year celebration by murdering 300 African migrants in Libya.

And the US, which abhors a power vacuum, is apparently returning to Iraq with serious boots on the ground:

Defense Secretary Ashton Carter informed Congress last month that a "specialized expeditionary targeting force" would be sent to Iraq on top of the 3500 personnel already there, with the authority to operate in Syria too. This mix of Special Forces "will over time be able to conduct raids, free hostages, gather intelligence, and capture ISIL leaders," explained Carter. Where greater opportunities appear to work with local forces, he added, "We are prepared to expand it."

That most of the above is both the West's fault and still getting worse implies that the Middle East will be a source of continuing trouble in 2016. Europe will get another million or so refugees, the US presidential campaign will be hijacked by ever-more-grandiose invasion plans, and military budgets around the world will rise, regardless of the fiscal and monetary consequences.

And -- the ultimate point for this website -- financial instability will be magnified by the long list of things that could go wrong when US markets are closed. Yet another reason for risk-off to be the dominant mindset in the year ahead.

 

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