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from The Great Debate:

If at first you don’t succeed in Iraq, Surge, Surge again

Major-General Hertling, the commander of U.S. forces in northern Iraq, walks during a battlefield circulation patrol on the streets in Mosul

America's new strategy for resolving the Sunni-Shi’ite crisis in Iraq? The Surge -- again.

Joint Chiefs of Staff Chairman Martin Dempsey sounds as if he were reading off the 2007 script, echoing the divide-and-conquer strategy that was the basis for the Surge: “If you can separate those [Sunni] groups,” Dempsey said, “then the problem becomes manageable and understandable.”

So, Washington is now sending U.S. officials to meet with Sunni tribal leaders and others. The ultimate goal -- after hopefully forcing out foreign fighters from within Sunni ranks in 2014, as in 2007 -- is political reconciliation between Sunni and Shi’ite.

It won't work, because it hasn't.

History is, in the end, all that matters. In January 2007, following signs that the metastasizing Sunni-Shi’ite conflict in Iraq was not about to stop without some new sort of intervention, then-President George W. Bush announced the Surge. The most public component was the deployment of 26,000 additional military personnel to Iraq, a clenched fist of freedom.

from MacroScope:

EU carve-up

Elected president of the European Commission Juncker is congratulated by European Parliament President Schulz after his election in Strasbourg

EU leaders meet for a summit at which they were supposed to decide who gets which European Commissioner posts – one for each member state – in what will be a huge carve-up, so huge in fact that it may well be that only a very few jobs are decided tonight.

Current best guesses – though they are just guesses – are that despite a willingness among some to play nice with the Brits, Prime Minister David Cameron may lose out again having voted against Juncker at a June summit. He is seeking one of the big economic portfolios; internal market, trade or competition but putting forward a low-profile politician as his point person in Brussels has not that made that any more likely.

from MacroScope:

Draghi vs Weidmann

draghi.jpg

European Central Bank President Mario Draghi makes a lengthy appearance in the European Parliament in Strasbourg. He will doubtless reassert that the ECB would start printing money if necessary but, as we reported last week, policymakers are fervently hoping they won’t have to and that a raft of measures announced in June will do enough to lift the economy and inflation.

Bundesbank chief Jens Weidmann fired another broadside over the weekend, saying rates were too low for Germany and policy should remain expansive for no longer than absolutely necessary.

from Expert Zone:

India’s Iraq problem

(This piece comes from Project Syndicate. The opinions expressed are the author's own)

Iraq seems to be falling apart, with the rapid advance of the militant Islamic State in Iraq and Syria (ISIS) threatening to lead to the country’s division into Shia, Sunni, and Kurdish entities, while blurring its border with its turbulent western neighbor. Moreover, the tumult is now threatening to spread to two more nearby countries, Afghanistan and Pakistan, which already are facing myriad internal challenges. For India, the message is clear: its national security interests are at risk.

from Expert Zone:

‎India Markets Weekahead: Correction could follow budget week

(Any opinions expressed here are those of the author and not of Thomson Reuters)

Last week's robust pre-budget rally belied expectations, with the Nifty closing up more than 3 percent at a record high of 7,751‎. Automobile sales, manufacturing PMI as well as services PMI showed an uptick. The Iraq turmoil seems to have taken a back seat with oil prices receding from a nine-month peak. A rally in world markets, with life highs for the DJIA and S&P 500, also aided sentiment.

India's fiscal deficit in the first two months has already touched 45.6 percent of the full-year target. Though this would have been a negative indicator, the markets welcomed Finance Minister Arun Jaitley’s remarks about focusing on fiscal consolidation against "mindless populism".

from The Great Debate:

If Iraq must be divided, here’s the right way to do it

Shi'ite volunteers, who have joined the Iraqi army to fight ISIL, hold a sign during a graduation ceremony in Najaf

As Iraq spirals toward chaos and its Kurdish region talks independence, the issue of partition, or federalism, has resurfaced. This is a concept that then-Senator Joe Biden strongly advocated in 2006. Though it would be difficult to accomplish, federalism could still be a helpful element as Iraqis struggle through their current tragic mess.

The appeal of federalism could grow if Iraqi leaders in Baghdad cannot agree soon on a government of national unity, ideally one without Prime Minister Nouri al-Maliki, who has proven so divisive. Whether a “soft partition” -- meaning the creation of a Sunni autonomous zone to complement the existing Kurdish one -- or “hard partition” --meaning the formal redrawing of regional lines -- it would seem a natural idea. Not only because of the recent violence, which has caused hundreds of thousands of Iraqis to flee their homes, but also the arbitrariness with which state borders were drawn by the European powers after World War One.

from MacroScope:

ECB: talk but no action

EThe European Central Bank holds its monthly policy meeting and after launching a range of new measures in June it’s a racing certainty that nothing will happen this time. However, ECB President Mario Draghi has plenty of scope to move markets and minds in his news conference.

We are still waiting for details of the ECB’s new long-term lending programme which is supposed to be contingent on banks lending the money on to companies and households. Last time they got a splurge of cheap money, the banks largely invested in government bonds and other financial market assets. With euro zone yields now at record lows, the ECB would not like to see a repeat.

from MacroScope:

Erdogan on the move

Turkey's PM Erdogan walks to his plane at Esenboga Airport in AnkaraTurkey’s ruling AK party is due to announce its presidential election candidate. Prime Minister Tayyip Erdogan is widely expected to announce his presidential bid, and then emerge victorious in the polls after a 40-day election campaign. Polls give Erdogan around 55 percent of the vote and a 20 point lead.

Under Erdogan, Turkey has made great strides economically and diplomatically but some if not much of that progress has been tarnished by a crackdown over the past year on anti-government protests and a purge of the judiciary and police in response to corruption charges against his acolytes which the premier says represent a plot by shadowy forces to oust him.

from Expert Zone:

The crisis in Iraq and an Afghanistan prognosis

(Any opinions expressed here are those of the author and not of Thomson Reuters)

The Islamic State of Iraq and the Levant (ISIL) has rampaged through western Iraq. A few thousand kilometres away in Afghanistan, the International Security Assistance Force (ISAF) is withdrawing, with Americans contemplating less than 10,000 troops on ground.

The Iraqi and Afghan landscapes have festering ethnic and sectarian divides in common. In Iraq, the ISIL has crafted one of the best success stories for radical Islamists in recent history. Is a similar manoeuvre on the cards in Afghanistan?

from MacroScope:

Clock ticking

Amid all the furore over David Cameron’s failure to block Jean-Claude Juncker for the top EU job at a summit last week, the bloc’s leaders signed a free-trade pact with Ukraine and said they could impose more sanctions on Russia unless rebels de-escalate in the east of the country by Monday.

In turn, Ukraine president Poroshenko extended a ceasefire by government forces until 10 p.m. local time today.

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