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We start on a somber note with the thirteenth anniversary of the September 11th terrorist attack that shook the world and forced time to stand still. It’s hard to believe that over a decade has passed since that fateful day and the fact that the nation has rebuilt itself from the devastation is a testament to the resilience of the American spirit. Yet the question remains, how much better off are we in light of the current fundamentals?
After an exceptionally contested administration in George W. Bush where the former President was accused of war-mongering and leading the nation into a financially unsustainable conflict with an ill-defined strategy, history is repeating itself once again. Though such redundancy is hardly uncommon, the velocity with which it is occurring certainly is.
On the eve of the tragic milestone, President Obama made a prime-time plea to Americans to support an open-ended campaign to rid the world of the extremist forces within the Islamic State. With violence in the Middle-East reaching fever pitch, escalated by horrific accounts of genocide against Iraqi Christians as well as the highly-publicized executions of innocent journalists captured by Islamic radicals, whatever military actions taken will likely spill over into Obama’s successor’s term, thus diluting any pretense of difference between him and Bush junior.
Despite the obvious comparisons, Obama was adamant about distinguishing his approach to that of his predecessor. The core differentiator is his promise not to involve ground-forces as the military takes the fight to the terrorist group known by the acronym ISIS or ISIL, focusing instead on air-power and specialized counter-terrorism units such as those found within the ranks of the Navy Seals. The proposed strategy will model those used in smaller-scale conflicts in Yemen and Somalia, where drone strikes and special operators have targeted extremists for years, according to the President’s speech.
While no one is doubting the justification of the use of extreme force to deal with an equally extreme threat, the problem that the current administration faces is multi-faceted. From an international perspective, the application of drone strikes has always been controversial, and has in past occurrences resulted in civilian deaths, fueling strong anti-American sentiment and catalyzing a vicious cycle of recurring Islamic radicalism. On the domestic front, American citizens are growing increasingly uncomfortable with government over-reach, surveillance of private information, and the imbalance of power towards the executive branch.
Giving the President a blank-check to initiate yet another open-ended war may lead several voters to consider a cost-benefit analysis regarding America’s foreign policy. Finally, there is the very real financial cost of funding what may likely be an ill-advised and ill-fated war. With the national debt well north of 17 trillion dollars and a mere six years removed from the greatest financial calamity in modern history, the United States is hardly in a position to launch a military campaign with no definitive terms. With so much on the table, introducing any level of uncertainty may be a prelude to disaster.
In market news, the equities sector languished through a lackluster week, with geopolitical conflicts continuing to weigh heavily on investor sentiment. On Thursday, the S&P 500 edged up slightly to 1,997 points while the Dow Jones shed 20 points to close at 17,049. In the precious metals complex, gold dropped down to 7-month lows off of technical selling by short-term investors, while silver took the brunt of intra-day damage with a nearly one-and-a-half percent loss of valuation. Palladium prices went into free-fall this week, with the industrial metal dropping down to 836 dollars. For digital currencies, it was another soft week as bitcoin stayed range-bound, rarely moving past the 480 mark.