At Crossvault we tend not to invest around risks or probable outcomes that are unknowable. The current geopolitcal risks are emblematic of just those types of issues. We can speculate on subjects like a nuclear armed Iran, and what would happen if there is a war in the Middle East, but it is pure speculation. However, I thought Ed Yardeni’s comment from Tuesday’s research was worth repeating. It is a telling commentary on the unintended consequences of a weak American foreign policy which may have direct consequences for the domestic and international markets. All around the world, everyone seems to be very angry. People seem to be fighting mad. Many just seem to have gone mad. I think I know why: Uncle Sam, the warden of the insane asylum over the past few decades, has left the
building and forgotten to lock the front door. Now there seems to be a widespread perception that the US is losing its willingness to project its military might to protect its values, interests, and allies around the world. That’s a dangerous perception because there are lots of bad and deranged actors on the world’s stage who have their own agendas for a world order that would be inimical to American interests.
