Middle East Noose Tightens
Research for Online Investors

by John Dalt

9/02/11

The Arab Spring we have watched develop in the last six months is morphing into a realignment of the Middle East that threatens stability for the region.  Long time allies Turkey and Israel are now drifting apart.  The U.N. released their report on the Gaza flotilla debacle last year.  The U.N. found that the Israeli blockade of Gaza was legal, but they may have used unreasonable force in stopping the Turkish ships.

Turkey recalled their ambassador and is expelling Israel’s along with severing all military ties between the two countries.  Turkey is also suspending all military agreements signed between the countries.

Make no mistake, the cut in military ties and diplomatic relations has little to do with the U.N. report or the Israeli attack on the flotilla that resulted in nine dead.  This is all about bolstering Turkey’s image with the Arab world.  They can read the handwriting on the wall.

The flotilla was a set-up to “invite” Israeli intervention and create a controversy.  The supposed “peaceful” pro-Palestinian activists were armed with clubs and attacked the Israeli commandos when they repelled onto the ship’s deck.

Egyptian citizens ousted Mubarak and now are facing elections this fall.  The Muslim Brotherhood is tightening their grip on the country.  Egypt has allowed the Iranian Navy into the Red Sea.  Israel’s Navy has deployed two warships into the area.

The Egyptian military controlled access to Gaza in the past, to keep weapons from the strip.  Over 150 rockets hit Israel from Gaza last month.  On August 18, a terrorist attack occurred from the Sinai Peninsula. The Egyptian military is responsible for security in the Sinai according to the Camp David accords that were signed 30 years ago.  Israel’s border with Sinai is not reinforced and the terrorists had easy access. Eight Israelis, five Egyptian police and army officers along with ten terrorists were dead by the end of the attack.

Israel said the terrorists were dressed in brown uniforms (like the Egyptian security personnel). Israel issued the following statement, “Israel is sorry for the deaths of the Egyptian policemen during the attack on the Israel-Egypt border.”  Egyptian politicians are condemning Israel for counter attacking the terrorists and chasing them into the Sinai.

The noose tightens on Israel

While we concentrate our attention on economic matters, the world is changing in ways that will create bigger and more difficult problems in the future.  It is hard to imagine the changes in the Middle East in the last year.  I cannot remember a President and Secretary of State cheerleading the kind of changes that are taking place.  The noose is tightening around Israel’s neck.

We are watching friendly leaders destroyed, enemies emboldened, and allies surrounded.  No good can come of it, except Muslim domination of the Middle East and annihilation of Israel, if that is your goal.  Butch Cassidy famously said “Who are those Guys?” while being chased across the big screen mountains.  He couldn’t understand the posse’s dogged pursuit. We just wonder “Who are these Guys?”

The noose tightens on the U.S.

I hope you have an enjoyable Labor Day weekend.  We will be traveling with our in-laws to an Oktoberfest in the mountains of Colorado, a great weekend of Polka Music, Leg-Wrestling, Bratwurst and Beer.  The market is closed on Monday; I will be back on Wednesday.

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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