Morning Commentary
The United States has joined Russia in targeting ISIS’ oil trucks, launching at least 283 strikes over the weekend. It’s a step in the right direction; it is likely too little, and maybe too late. According to a number of sources, ISIS has expanded into an economic powerhouse with various streams of income.
ISIS has numerous sources of revenue, including:
ISIS 2014 Money |
Revenue |
Oil |
$168.0 |
Theft |
$44.4 |
Tax |
$24.0 |
Kidnapping |
$45.0 |
Donations |
$5.0 |
Farming |
$200.0 |
Source US Treasury, Islamic State Financial documents &Bloomberg |
As much as we may loath to admit it, ISIS is a state. ISIS controls 50% of Syrian wheat, 33 % of Iraqi wheat, and 40% of Iraqi barley production.
With this in mind, it is time to fight ISIS the way we would fight a nation, which means a scorched-earth and going after all assets. If this is the case, it seems bewildering not to have a plan, and then to fight a war based on public relations instead of a plan to win. While we dither, look at the wide swath of land already controlled by the ‘junior varsity team.’
Global Terror Cost
However, I must admit that after listening to President Obama yesterday, I have little hope ISIS will even be contained; let alone defeated. For now, terrorism will probably continue to be a global phenomenon. There were attacks yesterday in Tunisia and in Egypt that killed a lot of people; it probably felt like any other day.
According to Institute for Economics and Peace, the direct and indirect global cost of terrorism tallied close to $53.0 billion last year. The organization’s Vision of Humanity unit tallies the numbers and calls them conservative.
I also suspect that the tally is a lot more- financially and emotionally. The growth of the global middle- class only happened as a peace dividend. Africa is on the cusp of joining, which makes it Ground Zero for terrorists.
However, vanity targets are in the west, including the United States.
As we head into the holidays, we must be vigilant, but not cower. In the meantime, we'll have to find ways to reestablish leadership and restore calm and confidence as the nation is poised to go off the rails.
Today’s Session
Lots of economic data pouring in today and we will have more details in the afternoon note but I want to point out personal income and spending. Income came in at solid 0.4% increase paced by a robust 0.6% increase in wages. But, the spending needle barely moved as savings continues to climb. Once again, I say it’s a reflection of a lack of confidence in leadership that spreads to the lack of confidence in all factors of life- hence squirrel away the cash and see what happens.
State of Consumer |
Change |
Personal Income |
+0.4 |
Personal Spending |
+0.1 |
Savings |
5.6% |
The stock of the morning is Deere (DE) which blew away earnings estimates even as revenues decreased 25% from a year ago. Guidance hints as the construction slowed down maybe coming to an end in 2016 as those sales are seen down only 5%.
Comments |
Fighting terrorism is basic playground 101. You do not deal with bullies the same way you deal with honorable children/people. The only way to deal with cowards is with force and power. They look at negotiations and appeasement as weakness. They must be met head on with overwhelming force. Obama is following them with underwhelming rhetoric. Since he is obviously intelligent, then it would seem that he is actually executing a plan. When will our country wake up to this fact? Ray Weldon on 11/25/2015 9:43:47 AM |
The only way this type of enemy can be defeated is to infiltrate the groups and assassinate the people who would promote this type of behavior, try to promote capitalism in these areas and realize it is going to take a long time and make sure whomever is in charge of the program has some serious non-political oversight so that once the objective is complete, "elimination of radical islam and its proponents", the program would be put to rest and not expanded to any other groups of people. Brad T. on 11/25/2015 9:49:02 AM |
Did our AC-130 and A-10 pilots REALLY RUN OUT OF AMMO??? Are you kidding me??? Need to append a index of chaos to the map. Excellent map, by the way. Libya, for example, is 100% chaos. Russia and others MUST get the oil price up to $100 per barrel. But the Caliphate will collapse if the oil price drops to $10 per barrel. Al M. on 11/25/2015 10:04:04 AM |
agree joecayman on 11/29/2015 10:41:05 PM |
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