The entire Mid East geopolitics has changed this past month andit is largely due to Iron Dome combined with the Shiite threat tothe Sunni rulers. Egypt is now closely aligned with Israel and iskey to making certain Hamas is decimated and unable to rearm. It isalso key to keeping the funding from Qatar and Turkey out of Gazawhich they have been doing lately. Hamas can demand whatever itwants, but Israel and Egypt and Fatah will not allow them to riseagain. Egypt essentially wiped out the Muslim Brotherhood and willkill any new Brotherhood leaders who try to emerge. What is sodifferent is that now Israel is closely aligned with the Saudis,Jordan, the Emerates, as well as Egypt. Fatah has a goodrelationship with Israel and stands to gain control of Gaza oncethe war stops. All Hamas can promise the people is moredestruction, while Fatah can point to the West Bank and the lack ofany destruction, a growing economy and a relatively peacefulrelationship with Israel. You might notice there was almost nodisruption in the West Bank during the Gaza war. No anti Israeldemonstrations in Egypt, Saudi Arabia and Jordan. Meanwhile Gazalay in ruins. Point counter point. It is there for all the Muslimsto see how cooperating with Israel against the Iran backedterrorists is good for their lives. They also see how ISIS brutallykills Shiites.

So what does all this mean. The war between Sunni and Shiite isjust getting underway in Iraq, it is full on in Syria and now it isspilling into Lebanon. That will go on for several years andthousands on both sides will die. Turkey is on the wrong side ofthis battle as is Qatar and they will pay a big price for that withthe Sunni Arab states. The US must become oil independent. We musthave Keystone and a lot more fracking and offshore drilling. Windand solar barely make a dent now that Obama has decided to killcoal. Coal was 40% of US power production. Wind and solar are lessthan 5%. It is hard to know yet how energy costs in the US will beimpacted, but likely for the good vs Europe and China if frackingand Keystone are allowed to go full out. That will mean morefactory production in the US if they ever change corporate taxrates.

In Europe, Putin is not backing off. The Europeans and Obamahave shown him they are afraid to take him on in any real way. Theydo nothing of material significance because the “don't want toprovoke him”!! I am not sure what invading another country andshooting down a civilian airliner is if Obama is afraid to provokePutin. Russia is a serious threat to European growth and stability.It may become a threat to the stability of the Euro one day. It ishard to know where all this goes from here since Obama has not donewhat needs to be done to speed up LNG shipments to Europe. Merkelhas shut the nuke plants and banned fracking for ten years.Combined these actions mean Putin has control over Europe via thegas lines. He will use that to lever them to be less punishing toRussia than they might otherwise be. Putin will now not back downand so it is hard to judge what investing in Europe might look likewhen you go to exit in five years.