The big news in the Middle East is what looks like reconciliation between Saudi Arabia and Iran—two regional Muslim heavyweights who have been at dagger point for decades. In a China brokered deal, the two countries are re-establishing diplomatic ties and opening embassies. This follows similar reconciliation between the Saudis and Egypt on the one hand and Syria on the other.
I’d call this a game changer, except it’s difficult to tell in that region. Nevertheless, it has the appearance of a game changer for this reason: It’s difficult to impossible to believe that this move was made without each side thoroughly vetting all the implications and coming to some agreement going forward on the issues that have fueled their enmity for so many years. For that reason one would not expect this initiative to break down quickly. Has there been some division of spheres of influence and/or action? Areas of cooperation? Time will tell.
Big winners and losers? Obviously China is the biggest winner. China establishes itself as diplomatic influencer to be reckoned with in an area that is still key to its energy need. It’s also key to Japan’s energy needs. Russia also wins because Russia has been very much behind this reconciliation. My guess is that NATO Turkey will not want to be the odd man out in this reconfiguration of the Middle East. Putin has wooed Erdogan with the possibility of making Turkey a major energy distribution hub in the region. With the the major energy players in the region now openly aligning, as it seems, with Russia and China, and with close military ties developing between Russia, Iran, and major Arab countries like Egypt (and Saudi Arabia?), Turkey will not want to be odd man out.
Major loser? The US. Clearly. Also Israel. Little need to elaborate, but I will add this—this development could also affect US/UK attempts to gin up unrest against Russia in the Caucasus. Georgia, Armenia, Azerbaijan. Russia’s regional positioning is looking more and more solid.
You can read more from Moon of Alabama:
Mediated By China Iran And Saudi Arabia Restore Ties - There Are Winners And Losers
Moon has a comprehensive list his own winners and losers.
Are we seeing a major escalation in the financial war between the Fed/NY Guys and Davos/US Treasury? American sovereigntists v. globalists? The fact that the shutdown of Silicon Valley Bank was done early on a Friday, rather than hush-hush over the weekend, suggests that something is up. But what?
Charlie Gasparino to Tucker: “This shows the economy is structurally screwed up”, and he quickly cites the crazy government spending as a major contributor to that. Hmmm. Who would want to get that message across? Not the Zhou regime!
Tom Luongo (Head Sneetch) goes for the big picture jugular. Note that Luongo is offering some alternatives here:
First thing's first. This $SIVB thing is happening before 5pm on a Friday. So, this is meant to affect the closing of this week's market. /1
https://www.zerohedge.com/markets/silicon-valley-bank-crashes-65-halted-pending-news
In 2008/09 all the FCID bank closures happened after the market closed on Fridays to limit the damage. Today we are treated to a vandalistic "Biden" regime making a big deal out of this DURING trading hours. /2
From a purely political and qualitative standpoint I'd say a number of things are at play here.
For a major SV bank to fail this spectacularly in 24 hours, 72 after the FOMC Chair went full "Resting Hawk Face" smells of a setup to force a "pivot" this weekend./3But, it could also be revenge for the direct attacks on $JPM CEO Jamie Dimon by running a 'nuts and sluts' campaign on him through Epstein and an incomprehensible ruling against him earlier in the week. /4
https://www.zerohedge.com/political/jpmorgan-sues-jes-staley-over-potential-epstein-fallout
So there we see two alternative theories: A Regime strike against JPowell, or maybe a strike by the NY Guys against the regime. Could it have something to do with Zhou’s crazy budget?
We have continued attacks happening against Credit Suisse, who the Fed helped out last summer, and who the Saudis and UAE put large sums into their spun-off IB unit.
This is a clear Davos attack on their enemies.
/5
So, payback for the attacks on Credit Suisse? Luongo appears to come down on the side of, this is a NY Guy strike on Zhou/Yellen—a big time shot across the bow. I tend to agree—even though I’m a complete ignoramus on banking and finance. But my guess is that this will prove a significant crisis for Zhou—this can’t be something he wants.
Peter Thiel comes out against $SIVB lends credence to me that this is a $JPM revenge play against SV for selling out the US to foreign, globalist powers.
Take away their money, you take away their power. More fallout from the Fed's war on egregious leverage 6/This smells like another $FTX hit job by the Fed and Wall St. to roll over one of their clear enemies and this is why it's not happening over the weekend...
Systemic risk is likely negligible and (prediction time) if $JPM scoops up the remains of #SIVB's assets, then we know /7But it could be a Davos attack which was anticipated. I'm not here to give definitive answers but to present the possible scenarios at play. /8
We should be hearing much more over the weekend and …
Just watched the Tucker segment on SVB. I think he is wrong on this. SVB didn't blow up from poor management. It blew up because interest rates went up. Its assets were performing as expected. Sure it was going to struggle as all it's customers were going to churn money and not be able to fundraise. As for the executives selling stock I don't expect much to come of it. I'll wait for the lawsuits ( there are always lawsuits) but it looks like all the problems were publicly available. And the regulators Bravo well done. They managed to corral half of the VC contagion in one box and let it explode only injure the people who made the bomb.
Both sides are using the collapse of SVB. The collapse went a lot faster due to the nature of the depositors, which made for a faster bank run.
The biggest loser of the Saudi Iran deal is the US. KSA (kingdom of Saudi Arabia) leadership is showing they don’t trust the US to protect them, and rather fear it. And with the Biden’s Administration’s continuing pushing big color revolutions and regime change, this makes perfect sense. Plus throw in the intense pushing lgbt / woke ideologies and for a traditional / conservative run country, you know you are on the Biden Administration’s enemies list. Or if your countries leadership disagrees with the US.
I just realized- The Biden Administration has managed to alienate / upset / ostracize every single Middle Eastern Power! They are actively plotting against Netanyahu. And shut down a proposed pipeline from Israel to Crete for natural gas. KSA was labeled as run by a murderer / thugs. Syria is partially occupied by the US, heavy sanctions, and the Us still wants regime change. Iran is under heavy sanctions. Iraq is now selling oil in Yuan. Libya is still a mess, and a huge example of US Hubris. Egypt the Obama Administration backed the Muslim Brotherhood, which got over thrown by the current regime. Turkey is being bribed by the Russians with making lots of money off sanction busting, and a potential energy distribution power house.