What’s going on?
The vigorousness of the Taiwanese election cycle puts to rest the myth that somehow the Chinese do not have the cultural capital for democracy.
DanC wrote to me:
Could the desire of the Saudis to have an IPO for Aramco be a way to hedge the risk of a revolt? Future revenues only have value to the royal family if they remain in charge. The greater the threat of ISIS, or some other group, causing a change in government, the greater the desire to sell some of their land locked assets today.
I say watch for who is exposed to the sudden weekend ten to fifteen percent devaluation. Lots of other EM currencies have gone down by about that amount, why should China be so different or immune? The Chinese government isn’t going to spend trillions of dollars on fighting a losing battle in the currency wars, they are simply waiting for the right time for this to happen. Don’t be caught off-guard.
I still think Ted Cruz will be the Republican nominee, as for some while he has been focused on becoming President and he has the requisite level of talent. Many Democrats are underestimating how rapidly he will be able to shift to the center. Hillary calling him a flip-flopper will set peoples’ minds at ease, not turn them against Cruz.
I’m glad we played it cool with Iran this time around but let’s be clear — it’s them playing us, not vice versa.