The Undeclared War in the Middle East

--This can’t be good. The Associated Press reports that, “Scores of Iranian students have attacked the Saudi Arabian embassy with firebombs to protest the Gulf country's role in cracking down on anti-government protesters in Bahrain.”

--But first, one way of looking at the emerging events in the Middle East—and this is the way we looked at it last month’s issue of Australian Wealth Gameplan—is that everything is quickly becoming a proxy war between the Iranians and the Saudis. That is a gross simplification, of course, given the local complexities in each country.

--But the main idea is that the modern national borders in the whole region are fairly recent (historically speaking) and fairly artificial. If there was ever a time to re-draw them, now would be it. Surely all the parties with strategic interest in the region (Russia, China, the U.S., former colonial overlords from Europe, various ruling royal families and dynasties and of course major religious groups) see the current turmoil as their best chance in years (or ever) to gain influence or control over the world’s major proven oil reserves.