Citi Is Stunned How Quickly The "Extraordinary Political Backdrop" Is Deteriorating | Zero Hedge


Some interesting observations from Citi's Tin Fordham on "The Tempest" and What to Make of Turkey's Failed Coup, Nice Attacks, and the Emerging Politics of Fear and Anxiety. It appears that "nobody could have possibly predicted" what we said back in 2010 when the Fed launched QE2, namely that monetary policy will lead to global violence, conflict and war, and as a result is making it up as they go along.
Here is Citi's turn, courtesy of Tina Fordham.
In this note we provide an overview of our thoughts on the extraordinary political backdrop that is evolving, with more detailed explanation of the economic and strategy implications from our Turkey economists and EM strategist.

The coup attempt in Turkey comes fast on the heels of a series of events that have rattled nerves. Days before, the Bastille Day attack in Nice killed 84 people, amid intelligence warnings that France likely faces more attacks against difficult to protect soft targets, and just hours after President Hollande had lifted the state of emergency called following the Paris attacks in January. Less than 3 weeks before, the UK's vote to leave the European Union – the first country ever to do so – marked a watershed for developed market political risk and raises the spectre of an existential challenge for the European Union. At the same time, polling gains in key US swing states have prompted us to raise the probability of a Trump presidency to 35%, with the potential to go higher as Hillary Clinton's campaign remains lacklustre.
Taken together, these developments point to a marked increase in political risks in systemically-significant countries. At the start of the year, we flagged many of these in Citi GPS: GLOBAL POLITICAL RISK, as  well as introducing our thesis that rising Geopolitical Risks, accompanied by rising "Vox Populi" risks such as Brexit and changing US politics, were at risk of converging in new and powerful ways. Even so, we did not anticipate quite how many would transpire, let alone within such a compressed timeframe.

Across the advanced democraciesthe wave of resentment against political and business elites shows no sign of slowing down, let alone reversing. One common feature evident across the populations of these countries is the rise in sentiment that the country is "on the wrong track" and dissatisfaction. Terrorist attacks, scandals and rising opposition to immigration boost the grass-roots backlash to globalisation. The sense that leaders lack the political capital, will and tools to maintain stability and order in the face of these headwinds will almost certainly weigh negatively upon sentiment as well as the growth outlook.





A city councilor in southern France warns that some French citizens are gearing up for civil war as memberships of gun clubs explode in the aftermath of three massive terror attacks that have rocked the country.
In an article entitled What next? Could France be facing a civil war?, author Jonathan Miller, who is an elected council member in the village of Caux, asserts that the Nice truck attack has “shaken France to the brink of a terrifying escalation.”
Warning that France “may be on the edge of something resembling a civil war,” Miller reveals that membership in his local gun club has “quadrupled, from 200 to 800 members” in the last few months alone.
When asked why so many French people were buying guns and becoming interested in joining the gun club, one resident told Miller, “They’re getting ready for a war.”
“I talk to a lot of people at every level of French society and I am detecting a change of mood. And the mood is turning nasty,” writes Miller, adding that he is “no longer taking for granted that they will put up with this much longer.”
Miller explains that a lot of citizens are voting for right-wing politicians not because they are neo-fascists but because, “They are frightened” and nobody aside from people like Marine Le Pen have offered anything different to President Francois Hollande’s feeble response to Charlie Hebdo, the Paris massacre, or the Nice atrocity.
Miller sums up a mood that was expressed again today after French Prime Minister Manuel Valls was booed by the crowd as he attended a memorial in Nice. Attendees chanted for his resignation after Valls controversially said that France must “learn to live” with terror attacks.





 Turkish police have unofficially blockaded Incirlik Air Base in Turkey, according to a military source inside the joint NATO installation.
According to the source, who’s identity and position has been verified by TRUNEWS, the U.S. portion of the Incirlik Air Base has been cut off from local power since Friday, forcing personnel to solely rely on fuel generators to power mission critical buildings.
The source said that Turkish police units are still maintaining a blockade of the base entrance — which began Friday night — and that critical supplies such as fuel, food, and water are running low. Rationing protocols have gone into effect base-wide, and personnel are enduring above 90°C temperatures without access to air conditioning and other nonessential powered amenities. 
The source confirmed previous reports that local police entered the Turkish side of Incirlik Air Base on Saturday, and arrested the 10th Base commander,General Bekir Ercan Van. Eleven other Turkish service members and a police officer were arrested, a senior Turkish official confirmed to the Wall Street Journal Sunday. 
In a December interview with Turkish state-run Anadolu Agency, an unnamed USAF F-16 pilot told reporters that soldiers from both sides of the NATO installation ate at the same dining facility, and that the Turkish Air Command — which likely housed General Bekir Ercan Van’s primary office — was positioned directly next to the U.S. Air Command. 
Incirlik Air Base serves as a significant bastion of U.S. force projection in the Middle East, is headquarters to the US 39th Air Base Wing, and vaults over 50 B-1 nuclear bombers on-site. The source was unaware of the status of those nuclear armaments, but confirmed the base has maintained its Friday night security status of FPCON Delta — the same high level of alert military bases were placed on after the attacks on September 11th 2001. 

“Islam has a proud tradition of tolerance.” – Barack Hussein Obama
Isn’t it about time we crusade for self-defense?
I’ll say it again. Political correctness is a barrier to truth and a pathway to tyranny.
It’s also deadly.

As I beheld across my social media feeds Thursday night, the horrific, blood-bathed images of 84-plus slaughtered innocents on the streets of Nice, France (at the hands of yet another Muslim named Mohamed), I was reminded of a quote by the great Winston Churchill: “An appeaser is one who feeds a crocodile hoping it will eat him last.”
Consider, for instance, that according to a 2015 Center for Security Policy poll, 51 percent of American Muslims desire that Islamic Shariah law be made the law of the land. Moreover, nearly 30 percent say that violence is appropriate against Americans who “insult” Islam or its “prophet” Muhammad.
Both Islam and the Quran, among many other such atrocities, explicitly require worldwide caliphate (global domination and the violent imposition of Islamic Shariah law). It treats women as chattel, stones them to death if they are raped (or not properly attired) and, in even the most “civilized” Islamic nations such as Saudi Arabia and Iran, executes practitioners of homosexuality as a matter of law.
These facts are not open for serious debate and are available for all to read, hear, see and, tragically, experience. Islam, therefore, is inherently at odds with freedom, democracy and the United States Constitution. While devout followers of Muhammad readily admit this reality, the suicidal left yet remains hellbent, head in the sand, on “tolerating” itself, and the rest of us, to death.





German police shot dead a 17-year-old Afghan on Monday night after he attacked passengers on a train with an ax and a knife, seriously wounding four people, in what was “probably” an Islamist attack, officials said.
Several other people were also injured in the attack on a regional train near the southern city of Wuerzburg, police said, adding that the teenager was killed as he tried to flee.
“It is quite probable that this was an Islamist attack,” said a ministry spokesman, adding that the attacker had shouted “Allahu akbar” (God is greatest).
The attack happened around 9:15 p.m. (1915 GMT) on the train, which runs between and Wuerzburg in Bavaria.

“Shortly after arriving at Wuerzburg, a man attacked passengers with an ax and a knife,” a police spokesman said.
Four people were reported seriously injured and one other lightly injured. Fourteen people were treated for shock.
An eyewitness who lives next to the railway station told DPA news agency that the train, which had been carrying around 25 people, looked “like a slaughterhouse” after the attack, with blood covering the floor.
The man, who declined to give his name, said he saw people crawl from the carriage and ask for a first-aid kit as other victims lay on the floor inside.