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Naivety

“We’re gonna press the reset button on relations with Russia and Iran.”  Or how about “We’re going to lead from behind?”  Remember those words from 2008?  They sounded appealing to all of those who were tired of war and threats, and who wanted a peaceful world.  Those words helped steer many votes to our current President and were repeated by our former Secretary of State, who is now our leading candidate for the Presidency in 2016, share the words.  And now, five years hence, the world is on fire.


My mom once taught me that to be kind and generous to those who don’t warrant it is among the worst and stupidest things I could do.  She observed to me that I was by nature kind, and cautioned me that by sharing myself equally with all I was both doing a terrific disservice to those in my life who deserved my attention and care (which is by definition finite), as well as reinforcing the bad behavior of those who do not.  I probably did not learn that lesson too well at that time and have surely suffered as a result.  With that background, seeing this lesson play out on an international stage is especially uncomfortable to me.

Since our American olive branch has been extended to the world, and in particular to Russia and Iran, they’ve both toughened their stances and have wreaked increasing havoc.  Both are firmly behind the Syrian Assad regime.  Both have their fingers in Venezuela and North Korea.  Both have aided in arming and training Hezbollah and Hamas, who together have fomented tensions and violence for decades in the Middle East.

I wish my mom’s message had been shared with our President five years ago.  Perhaps, like me, he believed in the goodness of all people.  Perhaps, now, finally, he’s ready to re-visit that na├»ve belief and get tough. There are bullies and bad actors in the world, which look for others’ weakness to advance their own agendas.  Putin and the Ayatollah Khamanei are clearly among that group.  So are the tyrants of North Korea, Syria, and Cuba.  Trying to befriend them has, and will continue to produce disastrous results. Wake up, Mr. President.  You’re charm and goodwill won’t work with these types.  Stop talking nicely.  Now is the time to dictate terms firmly.  If you cannot, hopefully we will have a President in 2016 that will.

My friend Michael Desiato, who is a regular reader, suggested that I try to finish up my blogs by tying the commentary to the financial and/or real estate markets somehow.  In this particular case I believe that our President’s foreign policies, like those of Neville Chamberlain in the pre-WWII period, have made the world a much more dangerous and unstable place.  This increased uncertainty in my mind should cause heightened market volatility in very unpredictable and perhaps sudden ways.  For us Americans, the increased geopolitical instability may bolster our markets, which would be perceived as being relative safe havens.  This would mean we get really lucky, as this phenomenon will mask our deep fiscal problems.  I’d imagine that rates would remain low, and maybe even meaningfully lower in the U.S. than current levels, and that well-regarded real estate will be even more highly prized.


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