Escalation

The Maduro capture turned out to be a non-event as far as market impact goes. My parents used to own a condo in Venezuela back in 90s in Margarita Island to which I have fond memories of. My initial reaction to Maduro's capture was one of positivity as this tyrant has clearly caused tremendous misery for its people. Although I knew the US didn't do this out of the kindness of their heart, I figured it was a good thing to see this guy go. But then I learned that the VP and its military/militia/police  who are loyal to her are left in charge continuing with the same oppressive regime while the US doesn't support the truly elected opposition leader. Given the ease to which the US was able to secure Maduro, I would not be surprised to learn that the VP had a hand in it with the understanding that she would be allowed to become in charge. Sadly, without a full scale change of the loyalty of the military/police away from dictatorship and towards a democratically elected government, Venezuelans will continue to live in misery. The level of corruption woven into the fabric of Venezuela's political and economic system may be too great to undo as is the case with similar basket case,  authoritarian regimes. You know I'm not a doomer, but I gotta tell it like I see it. Let's hope I'm proven wrong. 

I am all for the use of force by a foreign country to remove an oppressive dictator but it has to be done right. First of all, the argument of "don't meddle and just let the people overthrow the government" doesn't hold water in many cases because the people are often powerless and are effectively prisoners in situations where the military/police are loyal to the oppressive government.  And when in comes to authoritarian leaders, you have to fight force with force. Diplomacy does not work. If however, an oppressive government is removed by force,  there needs to be proper plan in place to ensure a successful democratic transition and that's clearly not easy.  It would require the use of the foreign country's resources including their own military and people for several years  It is also difficult to uproot enough of the corruption and those who are still loyal to the oppressive government who are lurking in the shadows just waiting for their moment to usurp.. It doesn't seem the US is not interested in making the type of  commitments needed to ensure Venezuela becomes a free and democratic country. As we all know, the US failed in their attempts to reform Iraq, Libya, and Afghanistan when they ousted their dictators 

Now there's talks again about Trump wanting Greenland. Throw Iran tensions in the mix and it would seem likely that Trump is not done meddling around. He  appears to be serious about acquiring/occupying Greenland. Treasury Secretary Scott Bessent recently said Trump will not back down from acquiring Greenland, arguing Europe is too weak to ensure its own security. This reminds me of the tariff situation last year at this time. We all knew Trump wanted to implement significant tariffs but most of us thought this was largely a bluff and that he would settle for a lot less. Although that eventually ended up being the case, it sure wasn't initially when the "liberation day" plan was unveiled.  It would appear that this rising geopolitical tension is going to eventually hit the stock market given the market has a running of fumes feel to it.  As I've stated before, the longer we go without a sizeable 3-5% pullback, the greater the chance a larger 10% type pullback ends up occurring at this point. I can see that the futures are down 1% as the market is closed today. The recent comments from Trump and Bessent are giving me a clear sense of escalation and it looks like the markets may be feeling it too....we'll soon see.