# Who will cause Obama's first 3 a.m. call?



## Mike Baker (30 Nov 2008)

Shared under the......you get it by now.


LINK




> Who will cause Obama's first 3 a.m. call?
> Updated Sat. Nov. 29 2008 12:35 PM ET
> 
> RealClearPolitics.com
> ...




Intresting article in my opinion.


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## CougarKing (30 Nov 2008)

Hugo Chavez isn't on the list? Or Raoul Castro?  ??? Especially after the way they are being re-approached by Russia these days.


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## CBH99 (30 Nov 2008)

I don't think Raoul Castro would be on the Top 5 list.  Cuba is a relatively stable country, with a strong government and tourism industry.  And although the United States may not like that its...*oh my*..."not democratic" - I doubt either will want to stir up any instability in our own backyard.  "Don't rock the boat" comes to mind.

Between the looming financial crisis, the war on terror not only in Iraq and Afghanistan - but also Pakistan, SE Asia, Africa, and various parts of South America, strained international relations, and an important overhaul of America's image abroad - I doubt Obama will worry too much about Raoul Castro.


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## KingKikapu (30 Nov 2008)

Venezuela is in a financial crisis.  They pay for all of their extensive social programs with their one major export: oil.  There are three reasons why Chavez is of no concern to the US.  Firstly, the US is their largest oil trading partner at over 70% and is the only country that pays for Venezuelan oil at full price.  The rest goes to his anti-us latin american bloc (Cuba included) at bartered and/or 20yr financed rates.  While the bloc may help his regional influence, it is hurting his access to cash flows.  In September, Chavez was so desperate for cash that he sold a couple tankers of light crude at significant discount provided the buyer paid up front.  He also changed his accounts receivable to 10 days from the industry standard of 30+.

The second reason has to do with his budgeting pro formas; his government budgeted the price of oil to be around 65$/barrel.  Everything the government spends on depends on the price of oil being above this threshhold.  Unfortunately for him, while the price of oil jumped from ~40 to 147$/b in July, the economic crisis has since tanked the price of oil down to the 30's.  Don't expect to see it go back that high any time soon.  
Thirdly, he saw fit to take leave from the wold bank and international monetary fund, leaving his options for financial assistance to be close to squat.  That means despite his constant bitching about the Americans, he needs them more than ever to keep buying oil at full price.  Until he sorts that stuff out, he can do nothing but watch the currency spiral down the tubes.

Edit:  Spelling/grammar sucks, but I'm too tired to properly clean it up.  Gnight.
Put simply, he's full of hot air.  He's now trying to hold a country together with little to offer his people who have become accustomed to large government handouts.


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## tomahawk6 (30 Nov 2008)

No question that Obama will be tested and it will happen proably in his first 4-6 months in office.If he fails the test then the next 4 years will look like Clinton's with one terrorist attack followed by another. I think that if the global economy shrinks that will put a leash on Russian adventurism.Their stock market hasnt recovered from their Georgian adventure.Throw in much lower oil/gas prices they are going to be in tough shape - unless they figure out a way to drive prices higher.


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## KingKikapu (30 Nov 2008)

Russia's wealth is also evaporating with the dropping oil prices.  For the most part though, their recent successes have only benefited the corrupt/elite oligopolies.  Most Russians grumble about their lives, but see “international prestige” as a consolation prize.   The drop in oil has seriously cut into their political clout though.


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## Greymatters (30 Nov 2008)

I think domestic emergencies are more likely to be first - the next hurricane, earthquake, outbreak, etc...

At least his kids arent old enough that he has to worry about them getting picked up for drinking underage...


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## wannabe SF member (30 Nov 2008)

tomahawk6 said:
			
		

> No question that Obama will be tested and it will happen proably in his first 4-6 months in office.If he fails the test then the next 4 years will look like Clinton's with one terrorist attack followed by another. I think that if the global economy shrinks that will put a leash on Russian adventurism.Their stock market hasnt recovered from their Georgian adventure.Throw in much lower oil/gas prices they are going to be in tough shape - unless they figure out a way to drive prices higher.



I wouldn't be so sure, the OPEC members are talking reducing their oil production in order to drive the prices up.


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## tomahawk6 (30 Nov 2008)

They have been reducing production but the problem is that demand is down so there wont be an impact on prices.Demand goes up and or speculators jump back in and we will see prices increase.Meanwhile lets enjoy the respite.


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## KingKikapu (30 Nov 2008)

Many opec nations have production problems; they've put little money into maintaining their infrastructure, so their numbers are already low.  They can't drop them too far before their fixed costs are no longer covered.  Worse for them, whenever there is a decision to cut opec production, certain nations feel it much more than others.  It's not as popular for certain opec nations as you may think.


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## abo (1 Dec 2008)

Yea and OPEC is a cartel, the organization may decide to cut production but there is still monetary incentive for individuals to keep production high.


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## KingKikapu (6 Dec 2008)

yeah they can't drop it too far or it cuts into their contribution margin.  Certain nations like Saudi Arabia, who produce a much larger swath of oil, can weather the supply cuts better than smaller nations like Venezuela and the UAE.  Unlike Venezuela, UAE is trying to build up alternative markets for when the oil runs out.


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