Electoral chaos in Iran
The reports of violent protests and arrests of opposition leaders following the reported re-election of Mahmoud Ahmadinejad are worrisome, since any apparent use of police power to crack down on opposition politicians is a bad sign forpersonal freedom. It's one thing to hold an election -- China's Communist party even allows "elections" of a sort -- and it's quite another for democracy to exist in a context of real personal freedom. But it's even more unnerving because Iran depends heavily upon its oil exports, since it's one of the world's largest oil exporters. Iran has a largely state-controlled economy and a population that skews to the young side. And it's the 19th-largest country in the world. So what happens in Iran would have an effect on the rest of the world even if the country didn't have a large military and a nuclear-weapons program. Smart people ought to expect world oil prices to bounce around a bit in the short term and shouldn't be surprised to see Israel remind the world that it has a top-notch air force. But in the longer term, we ought to be aware of the potential for massive change in a country of around 70 million people in one of the world's hot spots. China has kept political activism in check because its economy has been growing at an explosive pace. But Iran's government appears to be trying to impose political repression in the midst of a stagnant economy. That doesn't give people's discontent a lot of venues for peaceful expression.
How Warren Buffett gets right what Ben Bernanke appears to get wrong
Short-term confidence is dangerous, because economics isn't just about business and finance; it's a social science, too. Feelings and reptilian-level emotions play a role in what happens. But in the long term, change and growth can have predictable effects, even if the specific changes can't possibly be forecast. Buffett represents long-term confidence and a clear understanding that the short term can't be known perfectly. Others, like Bernanke, seem to try the opposite.