Middle East
I find myself skimming the daily news more so than reading it. Nothing has happened to change my opinions that I have stated for the past half year. (I have left my 15 May article up on the site for the time being.) It is rather clear that Sharon sees no possibility of dealing with Arafat and has decided to just stall for time and turn the debate into incremental issues such as how long a cooling off period should be before talks should even begin. Sharon has broad support for his position because almost all Israelis have written off Arafat and it is probably fair to say that the Bush Administration has written him off too and would stay away from the entire affair except to the extent that the Saudis and other allies fear domestic spillover and urge the appearance of action to quell public opinion. But nothing more. As I’ve said, someone on the Arab side should draw the proper conclusions, and the day Arafat is replaced by someone reasonable is the day the Israelis have to face their nightmare of dealing with the Palestinian issue head-on. For this reason, I don’t expect the Israelis to do the dirty deed themselves (and it is possible that more militant organizations would then step into the void, but I think that is more a short-term effect during an internal shakeout than long term). It is possible that Sharon is laying the foundation for decisive military action with strong public support but I think it is more likely that Sharon could be very satisfied to sit around for several years and do absolutely nothing and, given the current situation, he could last that long because there are no alternatives or threats to his position. Shamir was an expert at this. The Arabs are used to being the patient ones – Sharon can match them at that game and wait for Arafat to somehow disappear. I personally wouldn’t mind shuffling the deck; the current situation offers no hope to either side.
Economy
My read is that leading economic indicators in the US show improvement toward the end of the year and that consumer spending has been rather decent. Many of these telecom companies are not going to recover and stock portfolio evaluation is probably worthwhile during the next quarter to get rid of some holdings such as Lucent. A big problem is that in the past, US weakness was balanced by strength in other international sectors such as Europe or Japan. Right now, there is weakness all over the world; China is not as strong as it appears and there are some real internal problems that could become of interest to the rest of the world if the Chinese government cannot resolve them. As for myself, I have resolved to try and do my part to stave off recession; I am desperately trying to think of something to buy (perhaps it’s time to get a Palm Pilot, eh?).
