Middle East in Crisis: a Worst-Case Scenario

05-Mar-2011

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An eternal optimist, Liu-Yue built two social enterprises to help make the world a better place. Liu-Yue co-founded Oxstones Investment Club a searchable content platform and business tools for knowledge sharing and financial education. Oxstones.com also provides investors with direct access to U.S. commercial real estate opportunities and other alternative investments. In addition, Liu-Yue also co-founded Cute Brands a cause-oriented character brand management and brand licensing company that creates social awareness on global issues and societal challenges through character creations. Prior to his entrepreneurial endeavors, Liu-Yue worked as an Executive Associate at M&T Bank in the Structured Real Estate Finance Group where he worked with senior management on multiple bank-wide risk management projects. He also had a dual role as a commercial banker advising UHNWIs and family offices on investments, credit, and banking needs while focused on residential CRE, infrastructure development, and affordable housing projects. Prior to M&T, he held a number of positions in Latin American equities and bonds investment groups at SBC Warburg Dillon Read (Swiss Bank), OFFITBANK (the wealth management division of Wachovia Bank), and in small cap equities at Steinberg Priest Capital Management (family office). Liu-Yue has an MBA specializing in investment management and strategy from Georgetown University and a Bachelor of Science in Finance and Marketing from Stern School of Business at NYU. He also completed graduate studies in international management at the University of Oxford, Trinity College.







From CNBC,

David Murrin is not the most optimistic person I have ever met.

In his recently published book “Breaking the Code of History” the hedge fund manager who runs Emergent Asset Management writes that he believes by 2025 there will be a major conflict over the fight for commodities and resources.

Murrin is very bearish on the prospects for the Middle East and the knock-on effects for oil prices, stocks and the economy.

“The current unrest is far from benign and is set to deepen into ‘regional civil war'” Murrin said.

“As well as civil war between Sunnis and Shias, there will be a conflict within a conflict to determine Sunni leadership,” he added. “There will increasingly be two systems competing for control…In the Middle East the two systems are already clear, the Shias and the Sunni.”

The conflict between these two ethnic groups is in its final stages and the winner will eventually control the entire region, according to Murrin.

Impact for the Economy

Recently we have heard Nomura predict oil could hit $220 if oil supplies from Algeria where to go off line while Boone Pickens told CNBC that $120 a barrel was possible.

Murrin, unsurprisingly given his views on a regional conflict, sees oil hitting $200 a barrel.

“Middle Eastern crisis will lead to an ‘energy shock’ for the West, increasing stagflation,” he predicted. “China to become closer trade ally with oil-rich Sunni regions as well as Iran.”

“The crisis will burst the QE2 (second round of quantitative easing) bubble and shatter illusion of recovery that the US is trying to portray, sending equity markets into a destructive bear decline of some 30 percent,” according to Murrin.

“The crisis will have serious implications for Western foreign policy since the leadership that will come to reign in the region will not be pro-Western,” Murrin concluded.

His Emergent Asset Management is heavily invested in Sub-Saharan Africa but does not invest in Northern Africa.

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