CIA Revenge

Geopolitics: The attack that killed 7 CIA officers at its forward base in Khost, Afghanistan is reported to be the handiwork of the Al-Qaeda linked Haqqani network. After getting mauled in S. Waziristan, H. Mehsud’s Pakistani Taliban is probably the second deadliest bad guy organization in the region, the Haqqani network is now the most powerful in Af/Pak and therefore the world. This network is run by a father/son team: J. Haqqani and S. Haqqani. The old man (J. Haqqani) is a hero from the mujahedin’s anti-Soviet war in the 80s. A brilliant military leader, J. Haqqani was the first mujahedin commander to capture and hold a major city from the communists in 1991. A year later he was instrumental in the Taliban’s victory in Kabul. He is an old buddy of Osama bin Laden and is probably the most important OBL protector in N. Waziristan, a safe haven and home base for the Haqqani network and Al-Qaeda itself.
The CIA’s Khost base, we are told, is a lynchpin in the agency’s Af/Pak drone force. A few days before the suicide bomber hit the CIA in Khost there had been a large number of successful drone strikes in N. Waziristan, killing a couple dozen or more Haqqani leaders/fighters plus a few Pakistani Taliban bad guys. The drones continued hitting targets in N. Waziristan two days after the Khost bombing, killing still more Haqqani fighters and leaders, affording the CIA some revenge.
The Pak Army had some sort of peace treaty with the bad guys in N. Waziristan before it began the big ground campaign in S. Waziristan. By flying so many drone missions into N. Waziristan, the CIA has effectively abrogated that peace treaty. Besides hitting back at the CIA, the bad guys have responded by massively increasing their terror strikes in the non-tribal regions of Pakistan, killing about 80 civilians a day over the past couple days.
A similar phenomenon has occurred in Yemen. Up until a few months ago the Yemeni Army has been exclusively fighting the Houthi rebels in the north, pretty much leaving the Al-Qaeda (AQAP) rebels alone in the south. But now, after US prodding, the Yemeni Army is attacking AQAP. This in turn seems to have caused AQAP to lash out against the US. Interestingly, the leader of the Houthi rebellion said Saturday that he was open to peace talks with the government. The Houthi rebels are Shiite and instinctively hate Al-Qaeda because it is not only Sunni but considers all Shiites apostates who must either be converted or killed. The Houthi rebellion will only cooperate with Al-Qaeda if it has no other choice. Robust US involvement could potentially turn the Houthi rebels into good-bad-guys, although nothing like this is happening yet.
So we are seeing an escalation of the wars in Yemen and Af/Pak. At the same time, December saw zero American combat deaths in Iraq. A US official in Yemen recently said, “Iraq was yesterday’s war. Afghanistan is today’s war… Yemen will be tomorrow’s war.”
As far as the stock market is concerned, the heat has definitely notched up several degrees in the Long War and consequently market volatility is increasing in a small way.