24 August 2015   Leave a comment

Turkish President Recep Tayyip Erdogan has called for new elections in hope that his party,  the Adalet ve Kalkınma Partisi (AK), will  win an outright majority in Parliament.  The previous election last June was inconclusive due to the strong showing of the Kurdish party and no coalition was possible to secure a majority.  Erdogan hopes that the recent outbreak of violence between the Kurds and Turkish forces, precipitated by the Turkish decision to enter the war against the Islamic State, will dampen the vote for the Kurdish parties, allowing the AK Party to secure an outright majority.  The gambit is reasonable, but the recent weakness of the Turkish economy, manifested by sharp declines in the value of the Turkish Lira, may make the  strategy more problematic than it seems.

Japanese Prime Minister Shinzo Abe has announced that he will not be attending the celebrations in China noting the 70th anniversary of the end of World War II.  Troops from other countries that participated in the war will be represented in the celebrations, but Abe’s decision to not attend represents as serious setback to the tentative steps China and Japan have recently taken to normalize relations.  Tensions between the two countries have been steadily escalating over the last five years and there is little evidence that any rapprochement is likely in the near future.

The interdependence of the global economy was obvious today as stock markets around the world fell sharply.  Much of the selling was due to fears about a slowdown in the Chinese economy that has caused commodity prices around the world to fall.  Many economies rely heavily on the sale of commodities and the loss of the Chinese market will cause slowdowns in every region of the world.  Stock markets have been quite ebullient for the last five years, so the declines come on top of some rather hefty gains.  Nonetheless, the sharpness of the declines today suggest that investors are feeling a slight case of panic–always a dangerous feature of stock market mentalities.

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Posted August 25, 2015 by vferraro1971 in World Politics

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