The End

More of that Spengler style commentary.

Financial crises, like epidemics, kill the unhealthy first. The present crisis is painful for most of the world but deadly for many Muslim countries, and especially so for the most populous ones. Policy makers have not begun to assess the damage...

Iran's President Mahmud Ahmadinejad controls Iran through a kleptocracy of Central African proportions, dissipating the country's oil windfall into payoffs to an "entire class of hangers-on of the Islamic revolution"...

Pakistan has one of the world's youngest populations and an enormous capital requirement. Young people borrow from old people, and countries with young populations should import capital from countries with aging populations. That is out of the question, for the world markets have turned Pakistan into a pariah. The cost of credit protection on Pakistani sovereign debt is now more than 3,000 points (or 30%) above the benchmark London Interbank Offered Rate (LIBOR), reflecting a complete shutout from capital markets...

Turkey has been able to keep afloat through the crisis, but barely so. The Turkish currency has fallen by a third, its stock market has fallen by nearly 80% in dollar terms, and the central bank must keep interest rates at a punishing 20% to prevent money from fleeing the country. Turkey has a real economy with a few first-rate manufacturing companies, unlike Iran and Pakistan, so the comparison is not quite fair. Nonetheless, Turkey relied heavily on short-term interbank borrowings to finance its balance of trade deficit, and the crisis has pulled the carpet out from under its economy. In August, before the crisis erupted in force, Turkey had 10% unemployment. It will get much worse.

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Asia Times Online :: Asian news and current affairs

Those who objected to America's role as world policeman will get what they wanted, but they won't like it: a religious war reaching from Lebanon to Pakistan, and Colombian-style narco-war spreading to Mexico and Brazil...

The financial crisis will push Pakistan further towards radical Islam. Now this proclamation will be preached from every mosque from Tyre to Lahore: "The corrupt West tried to seduce you with consumerism. Now the poisoned gifts of the West are shown to be an illusion, and those of you who lusted after them are left only with your humiliation..."

Mexico in some ways is the most worrying place in the Western hemisphere. A low-level civil war between the drug cartels and the federal government has been fought over the past two years, and the cartels are winning. Senior Mexican officials charged with suppression of the cartels have been moving their families quietly out of the country. The collapse of the oil price and the likely collapse of remittances from Mexicans in the United States threaten the stability of the financial system, and the Mexican peso has lost nearly 40% of its value during the past several weeks. With the collapse of the American construction industry, a major source of employment for illegal Mexican immigrants to the US, the economic safety valve has broken, and the cartels have in inexhaustible supply of young men willing to risk their lives for a living.

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Global Analysis - J. R. Nyquist "Hitting Bottom" 10/31/2008

But sometimes, even the insanity of war carries a cold logic of its own. This column has previously discussed the statements of Chinese Gen. Chi Haotian, known to Chinese dissidents. In recent years China’s leaders have been quietly talking to party cadres about a future war with America. It is true that Chinese dissidents see this as a political tactic for derailing the democracy movement. It is more than a tactic, however, to tell the political elite of a country that war is coming. The Chinese leadership has not been blind to the financial problem inherent in the U.S. economy and, therefore, the related problem of the Chinese economy. It is time to revisit Gen. Chi’s speech titled “War is not far from us and is the midwife of the Chinese century.”

Do we have time to consider the problems facing the Congo? Oh hell, let's just revisit Vietnam.

Intro Apocalypse Now