World View: Banks, Investors Prepare for Collapse of Euro

This morning's key headlines from GenerationalDynamics.com

  • Syrian anti-government rebels say they shot down a fighter jet
  • Analysis: Finding a Global Solution to the Syrian Crisis
  • Planned Saudi industrial city excludes mixed gender workers
  • Greece continues downward spiral as economy contracts 6.2%
  • Banks, companies and investors prepare for collapse of the euro

Syrian anti-government rebels say they shot down a fighter jet

Syrian rebels with captured pilot -- still image from video (al-Jazeera)
Syrian rebels with captured pilot -- still image from video (al-Jazeera)

A rebel group fighting against the regime of Syria's president Bashar al-Assad says that they shot down a government plane and captured one of the pilots. They've posted YouTube video showing the jet crashing and another of the pilot giving a statement. The Syrian regime confirms the plane crash, but said that the crash was caused by technical problems during a regular training mission. If the rebel claim turns out to be true, then it will be one more major psychological victory following a string of high profile defections from the al-Assad regime. Al-Jazeera

Analysis: Finding a Global Solution to the Syrian Crisis

The following is from Javier Solana, a Nato expert writing in the Moscow Times:

"The feeling is growing stronger by the day that Syrian President Bashar Assad's regime is approaching a tipping point. Kofi Annan, the United Nations and Arab League special envoy, has abandoned his efforts to implement an internationally agreed six-point plan to end the violence. Now the international community must think seriously about how to minimize the dangers inherent in Syria's domestic turmoil. ...

In particular, there is a growing danger of Sunni retaliation against the Alawite minority, which comprises only 12 percent of the population but controls the government, the economy and the army. The Alawites, who overcame second-class citizenship only when Assad's Baath party came to power in 1963, now believe that their very survival is linked to that of the regime.

If the Syrian opposition does not take the Alawites' concerns seriously, the country could be wracked by years of civil war, worse than the conflict that devastated Lebanon from 1975 to 1990."

From the point of view of Generational Dynamics, the last paragraph is completely wrong. Syria is in a generational Awakening era, and so this kind of civil war is literally impossible at this time. As I've written many, many times, the current conflict in Syria will not get worse but will fizzle. The precise scenario cannot be predicted, but right now it appears to be trending towards a situation where al-Assad steps down, and the remaining factors form some kind of unity government.

What's interesting about Solana's comments is his claim that the survival of the Alawites at the hands of the Sunnis is in question. "Survival" is too strong a word, but with 2/3 of the population, the Sunnis are going to be dominating a post-Assad government, and there will be bitter, lingering memories of the massive slaughter of Sunnis by Alawites in 1982, as well as the war crimes by al-Assad's regime against Sunnis in the current conflict.

What's really interesting is the comparison to the country next door, Iraq. Iraq is also in a generational Awakening era, and when its civil war fizzled in 2007, it formed a unity government, but this time the Sunnis are in the minority, and the Shia are in the majority. With the Alawites linked to the Shias against the Sunnis, it could be said that Syria is going through Iraq's civil war with the roles reversed. An argument could even be made that Bashar al-Assad is now playing the role of Saddam Hussein. Moscow Times

Planned Saudi industrial city excludes mixed gender workers

A lot of people like to work without being bothered by having people of the opposite sex around the workplace, and that's the case in Saudi Arabia, where a new single-sex industrial city is being planned for female workers. The city will not be entirely closed to males, as there will be areas where males will be permitted. LA Times

Greece continues downward spiral as economy contracts 6.2%

Athens graffiti: GREECE NEXT ECONOMIC MODEL (Kathimerini)
Athens graffiti: GREECE NEXT ECONOMIC MODEL (Kathimerini)

Greece's downward spiral continues to accelerate, with the second quarter of 2012 being the worst in years . The economy has contracted 14 of the last 15 quarters, with the last quarter's contraction at 6.2%. In May, the European Commission forecast that Greece's economy would shrink only 4.7% in 2012, but now that forecast has to be revised to a much higher contraction. As we've been saying for years, no solution exists to Greece's debt problem other than a major world financial crisis, despite the recitations of politicians. Kathimerini

Banks, companies and investors prepare for collapse of the euro

The 1930s Great Depression was worsened by high protective tariffs imposed by countries around the world. Tariffs are now considered unfashionable, but in today's financial crisis, another form of protection is being practiced in Europe. There's a growing sense of resentment in both lending and borrowing countries -- the lending companies resenting having to bail out profligate neighbors, and the borrowing countries having to suffer the demands of people lending them money. A sharp measure of the increasing nationalistic protectionism in Europe is that banks and companies are refusing to allow their money to flow across national borders, for fear that the euro will collapse. More and more banks and companies are refusing to take any credit risks at all in Europe. The European Central Bank (ECB) is trying to fill the gap by providing liquidity, but that's only fueling fear that the euro is approaching collapse. There are two countries that have benefited from these fears: Germany and the United States. Excess liquidity is flowing into both these countries, despite low or even negative bond yields (interest rates), because financial execs are opting for safety over yield. Spiegel


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