Wednesday, July 16, 2008
Economic Jihad
Surfing through headlines, I came across an article discussing the ongoing trial in Canada of Mohammad Momin Khawaja, the first person to be charged under that country's new anti-terrorism statute.
What was interesting was to read about his concept of "economic jihad"-that one measures the success of a terror attack by the impact it has on the economy. In his view, it is more important to negatively impact a country's financial and transport infrastructure. For Khawaja, 9/11 was more successful not because of the casualties but for what it did to the economy.
We focus on the physical protection of assets; does this mean that some may shift their efforts to take advantage of our economic vulnerabilities? What Soros did to the British pound, might some financier do to the dollar in the cause of jihad?
What was interesting was to read about his concept of "economic jihad"-that one measures the success of a terror attack by the impact it has on the economy. In his view, it is more important to negatively impact a country's financial and transport infrastructure. For Khawaja, 9/11 was more successful not because of the casualties but for what it did to the economy.
We focus on the physical protection of assets; does this mean that some may shift their efforts to take advantage of our economic vulnerabilities? What Soros did to the British pound, might some financier do to the dollar in the cause of jihad?
Comments:
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George Soros bet against a British government that was trying to prop up the overvalued Pound to keep it in the ERM, and made lot of money at the British government's expense. If the financier terrorist can similarly identify an as-yet-undetected structural crack in US currency policy, he/she will exploit it to the full, but so will any other financial player in the same position. Anything else is by definition factored into the market and cannot be exploited by a financier to his/her exclusive advantage.
Can a terrorist financier push the currency market one way or other anyway because he/she's such a big player? Conceivable, but it takes a lot of dollars to do that by yourself, and you're taking on a huge risk. Remember what happened to the very, very rich Hunt brothers, and they were just doing the much smaller silver market..
I think that terrorist financiers (if there are such people) and non-terrorist financiers (if there are such people) differ in motive only.
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Can a terrorist financier push the currency market one way or other anyway because he/she's such a big player? Conceivable, but it takes a lot of dollars to do that by yourself, and you're taking on a huge risk. Remember what happened to the very, very rich Hunt brothers, and they were just doing the much smaller silver market..
I think that terrorist financiers (if there are such people) and non-terrorist financiers (if there are such people) differ in motive only.
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