I am grateful to one of the readers of this blog who reminded me that I have ignored the Pakistani military offensive against Taliban strongholds in North Waziristan. The action is indeed highly significant, as it represents serious risks to the government of Pakistan, but also is reflective of a broad consensus among the major political parties, including the Movement for Justice, that effective action had to be taken against the threat posed by the TTP. After the attack on the Karachi Airport, the government was obliged to take strong action.
In 2001-02 Argentina defaulted on $200 billion of its sovereign debt. As is usually the case in such circumstances, the owners of sovereign bonds in default typically take only a percentage of what the bonds were worth rather than lose the whole amount. In this case, however, some hedge funds (Argentina refers to them as “vulture” funds) refused to take the percentage (what is often referred to as a “haircut”). The hedge funds have pursued the matter all the way to the US Supreme Court, demanding that they be paid in full, and in this case have won the case. Argentina is scheduled to make payments to the bondholders within a few weeks, and it is clear that it does not have the money to pay the hedge funds in full. Thus, a crisis is looming and Argentina may be facing another sovereign debt crisis.
Iraq has formally requested air strikes from the US against ISIS. The request comes as it becomes clear that ISIS is deliberately trying to cripple Iraq economically by attacking oil facilities in the country. There are reports that ISIS has seized the country’s largest oil refinery. The impact on the global oil industry will be slow to unfold, but the effects on the Iraqi economy will be immediately obvious as electricity and transportation are completely dependent on supplies from that refinery. At this point, it seems doubtful that the US will in fact launch air strikes, but the future possibility of such attacks cannot be ruled out.
World Politics News 
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