An historic night it was.A pleasure to have a private dinner with the Crown Prince of Saudi Arabia,
Saudi Arabia and the Common Knowledge Game
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“and then everything returns to ‘normal’”.
And so it may. Of course, normal for Saudi Arabia means old school Wahabi fundamentalism which leaves little room for Mssrs. Iger & Rock and other purveyors of infidel corruption. MBS has more enemies than your average tyrant and you may be sure that all of them are looking for ways to exploit this situation.
Ben, I think both you and Rusty are right. This will go back to normal on the surface, but below the surface, no one will forget. It will also likely have a reaction function in SA. In order to bolster their “rouge” hypothesis, or whatever other face saving story allows the world to paper over this act, they are going to be on their best behavior. That might end up including some actual reforms.
After spending fifteen or so hours on my high horse after reading your piece (about a third of them asleep) - “how can we go back to supporting SA after this! / how did we partner with them before this! -” the realpoltik of the MidEast broke in to my comfortable moral cocoon - “there are no good choices.”
As a liberal democracy that supports individual and minority rights through genuine rule of law - with all the flaws every even-good country has - I understand our support for Israel, but after that, the choices in the MidEast get slim.
So do we just abandon the MidEast? Give up any influence and leave it to its own devices / or to Russia’s / or to an aborning China’s? Would that be better or worse for its people / its future / our present / our future? Or do we continue to partner with what we think is the least-bad strategic country and try to do our best working from within the belly of the beast?
Is having some influence to “nudge” (doesn’t that word echo ominously in ET terms in this case) the MidEast in a better direction worth the moral tradeoffs? Or is a bigger-picture view of staying above it morally and practically a better approach - i.e., do the right thing morally where the rewards are that we get to do the right thing morally until a better opportunity to help and improve the MidEast arises?
Will it go back to “normal” or will “normal” be redefined? Masayoshi Son got $45B of his $100B Vision Fund from Saudi. PE gets a significant proportion of their funds from the Saudis. Maybe the new normal is just a bit more abstraction? If Masayoshi Son raises $100B every 2 years or so, how much of that will be Saudi money?
You may have already hi-lited this in an earlier writing but I am struck by the parallels between the common knowledge game and Malcolm Gladwell’ s Tipping Point.
It’s different because common knowledge is something “everyone knows” whereas a Tipping Point is where a new idea gains credence, but the acceptance by the main stream is the same concept.
More important is how to use this information to affect change.
As the nattering nabobs of the Nejd are wont to say: there are old royals and there are bold royals, but there are no old, bold royals. If Ladbrokes starts making book on the Crown Prince’s longevity, I’ll take the under.
How do “real assets” line up in a world where The Narrative is shifting to Axis vs Allies? We’re seeing the unprecedented cohesiveness of world governments for the past 10 years starting to disintegrate into Axis v Allies. If we’re moving into that polarization or even beggar thy neighbor, that isn’t the same dynamic as the old “rising tide” of the past. That’s going to make winners and losers out of each asset on a country by country (or more likely an Alliance vs Axis) basis as opposed to a “commodity boom”. Right?
For instance oil. The US, despite it’s current virtue signaling tsk’s at MBS’s behavior, is making it very clear that it is staying staunchly in the Saudi camp (the Alliance). That (along with a healthy dose of US sanctions) forces Iran into the camp of those that refuse to follow the sanctions (the Axis). Same with timber, steel, or uranium. In that scenario the global price of the asset is relevant, it’s the price asset relative to its alliance that matters. Finding those imbalances in the asset ledger of each alliance would be interesting.
Oil is probably a hard one to arbitrage in advance as that’s the easiest one to place importance on. The non-sexy and currently easy/cheap to obtain thanks to global cohesion and super long supply lines but oh so fundamental assets are probably where it’s at in that scenario. Thoughts?
Is it wrong to want desperately to make money off human nature being human nature? It’s a bit of a cathartic process if done right. I wrestle with this from time to time.
Making money off human nature being human nature in order to finance our own human nature…
Reminds me of the circular snake eating itself. Sure does taste good all the same.
In a month or so we should expect a fresh announcement of some additional philanthropic giving from SA. Reminds me of similar mishaps like United Airlines smashing the front teeth of that Vietnamese-American doctor. UA is still flying and so too will SA.