This may be a month where short is sweet. We have just completed the cycle of Jewish holidays and are looking forward to some family holiday time as Karen moves into the latter part of her maternity leave. I am planning a bit of foreign travel in the next month and should have some good material next month.

Some thoughts on the last month of news:

Iran – My big news this month is that I believe the US is planning military moves against Iran. Problem is there is a lot of misinformation going around and I can’t tell if the latest stories that accuse the planning of being half-assed and mainly toward striking at Iranian Revolutionary Guard units (totally useless and inflammatory) are true. But the evidence is out there that something is in the works. The Americans are doing a lot of training and coordinating with local Gulf and Jordanian Arab air forces. The Israelis are uncharacteristically keeping quiet.

Iraq – Paul Krugman is a Princeton economist that writes a column in the NY Times. Occasionally, he has something unusual to say. This month he noted that an American oil company signed a big oil deal in Kurdistan which pissed off all the other Iraqis and shot to hell the negotiation of a national oil law. What’s interesting is that the head of this company is on President Bush’s intelligence advisory council for Iraq, meaning he knows what’s going on in the country and so does Bush. Krugman believes that the Prez and his advisors know that Iraq is going to be unstable and that they will never agree to anything but that they don’t care and are letting such deals go through (a) because they are making money from all this instability and (b) they can’t solve the country’s problems and are content at this point to pass time and blame the next administration for whatever is going wrong in that country. I think Krugman is onto something. The truth behind whatever is going on in Iraq is very far from the publicly stated policy and it is one reason the US is being burned so badly in this venture. The hypocrisy is too blatant for anyone to ignore, let alone for our enemies to allow anyone else to ignore.

Bin Laden was the Shiites’ greatest gift. Think about it – he’s a Sunni and what he managed to do was get Iran into position as the greatest threat ever to Arabia and to whatever hegemony the Sunnis had built up in the region. The US as a threat to Arabia doesn’t compare but the US is now more enmeshed in that region than ever before, all of which is precisely what Bin Laden had hoped to avoid. 

Two predictions in Israel: (1) There will be a major military campaign in Gaza, probably after November’s summit. (2) Marwan Barghouti will be released from prison whenever Abbas decides to retire and he will be a major component of the next generation of Palestinian leadership.

Lebanese army winning battles and the hearts of the Lebanese; Arabs in the street tend to side with the domestically powerful and as the Lebanese army wins a few rounds they are getting more support within Lebanon. The fact that Christian Lebanese are starting to arm themselves as never before is not a good sign for future relations within that country because they see that they are just going to be used by the other moslems and will be frozen out of the country’s future if they don’t resist. This just means more war. One thing that both Lebanon and Palestine need is for those without arms to be fed up with the mafias that have arms and not be afraid to publicly come out and say so.

I’ve been searching for insight as to New York City Real Estate which so far has defied the rest of the country. Everyone I know in the business thinks it will tank in the year ahead and, despite recent reports of a great previous quarter which reflects sales before the subprime market turned south, people in the business tell me the deal flow is already slowing. A top valuation consultant to developers says they are under worse terms getting loans and have to put up more cash because the lending markets have tightened; this means they have to unload their stock of unsold apartment units in a new building before they can go onto the next project instead of sitting on them hoping to get the highest dollar for them. Another problem is that projects being built are being sped up because developers are afraid that a year from now people just won’t be buying, so we will have a glut hit the market at the worst possible time.  Another problem is that people buying the nice apartments are the Wall Streeters who with bonuses have had the cash to buy and take out big mortgages; it’s been nuts that buying for cash has gotten you no discount because it has been taken as a given around here that everyone either had cash or knew they could get a mortgage. But Wall Street isn’t going to be as generous this year and it’s harder now to get a mortgage. One long-time developer sold all his buildings on the upper west side this year and another said prices could go down 50%. So we have renewed our leases for another year and will wait and see what happens. New York is historically 3-5 years behind the rest of the country and it’s turn is to come. Mayor Bloomberg is already anticipating a slowdown in the local economy and has ordered city departments to trim their 2008 budgets. Meanwhile, I would just as well double down on Exxon, and the indexes of Australia and Singapore.