Iraq

For the first time since the conflict in Syria began, coalition warplanes bombed Bashar al-Assad's troops in what may have been an "accident" or what may signal a dangerous strategic shift for the US. Meanwhile, Turkey says Russia violated the treaty governing passage in the Bosphorus by placing a soldier with a rocket launcher on the deck of the Caesar Kunikov.

• Obama in speech to nation vows to defeat 'new phase' of terrorist threat (Reuters)
• Clinton Urges Social-Media Intelligence Sharing in Terror Fight (WSJ)
• Obama urges tech, law enforcement to address social media used for plots (Reuters)
• NATO says won't send ground troops to fight IS (Reuters)
• Le Pen Scores Historic Victory in France's Regional Elections (BBG)

With Draghi's Friday comments, which as we noted previously were meant solely to push markets higher, taking place after both Europe and Asia closed for the week, today has been a session of catch up for both Asian and Europe, with Japan and China up 1% and 0.3% respectively, and Europe surging 1.4%, pushing government bond yields lower as the dollar resumes its climb on expectations that Draghi will jawbone the European currency lower once more, which in turn forced Goldman to announce two hours ago that it is "scaling back our expectation for Euro downside."

Iraq “may soon ask Russia for direct military intervention in response to the Turkish invasion and the violation of Iraqi sovereignty."

You've seen those internet ads that offer "one weird trick" for eliminating belly fat or boosting testosterone, right? Well, here's one weird trick for getting rid of ISIS and boosting our security from terrorism. The "trick" is non-intervention. And it is only weird in the sense that it is so uncommon in this age of war. Nonetheless, it works. The "one weird trick" has three easy steps. These steps are only "easy" for Westerners, because they basically amount to us refraining from constantly screwing things up. Once we get out of their way, the hard work will be done by locals, which is as it should be.

"...Should you continue your flagrant support of Saudi Arabia by way of foreign aid and weapons sales, you are no longer to be trusted to hold an elected position of influence. You should therefore resign, effective immediately. The question is: Is your allegiance to the people of the United States, or are you beholden to another kingdom?"

"When US officials say they don't see how the terrorists' oil is smuggled to Turkey... it smells badly of a desire to cover up these acts."

Inequality of wealth is inequality of power. A study just released finds that "America’s 20 wealthiest people — a group that could fit comfortably in one single Gulfstream G650 luxury jet — now own more wealth than the bottom half of the American population combined, a total of 152 million people in 57 million households.” How much political power do the people who would be inside that jet — and their friends — actually have?

The vicious Isis attacks in Paris represent yet another unpardonable offense; and through war, Cameron and Hollande seek to avenge the innocents who were killed and wounded. But as the humiliating outcome of the Suez war reminds us, there are some problems to which war is an unsuitable response. Across much of the greater Middle East today, we confront one such problem. For western governments to reflexively visit further violence on that region represents not a policy but an abdication of policy. It’s past time to think differently.

"In the year ahead, geopolitics likely poses the greatest potential to disrupt markets in terms of event risk. There is also the potential for geopolitical risks to intersect with economic fragility in the event of a downturn, amplifying both."

CNN Turkey, citing security forces officials, is reporting what appears to be yet another escalation in the middle east maelstrom as Turkish troops enter Iraq. So suddenly, just as the world is scrutinizing Turkey's role in the Islamic State oil trade, Ankara decides to send anti-ISIS troops across the border? Are they trying to secure the crude trade and guard the trafficking routes?

Saudi Arabia is at risk of becoming a major destabilizing influence in the Arab world, German intelligence has warned. Internal power struggles and the desire to emerge as the leading Arab power threaten to make the key Western ally a source of instability, according to the BND intelligence service. “The current cautious diplomatic stance of senior members of the Saudi royal family will be replaced by an impulsive intervention policy,” a BND memo widely distributed to the German press reads.

As Reuters reports, "Israel has quietly tested ways of defeating an advanced air-defense system that Russia has deployed in the Middle East and that could limit Israel's ability to strike in Syria or Iran, military and diplomatic sources said."