As far as ripping yarns go, the unrolling of the political tale of the North African and Middle Eastern states has had all the drama of a Clive Cussler novel – fast changing, very exciting and highly improbable. From the mad rants of a demented dictator, to the pleading cries of those cut off in the desert with limited food and water, fear and emotion have been running high. Just add to this the appearance of the Iranian Navy off the coast of Israel and Lebanon to coincidentally tie in with the recent Hezbollah conferences and call for action, and you can only consider that anything could happen from here – because nobody actually knows.

So what do we know? The stalwart of the US economy, the US consumer is not in very good shape and even the ubiquitous Wal-Mart has continued to reflect this weakness with poorer figures. The US housing market is still disastrous and politically Washington seems to be deadlocked, with the administration swiftly moving towards running out of day to day cash to keep the system going. However, before we all leap into the canoes and head up that well known creek (with or without a paddle) – remember that we have been here before. The political brinkmanship of the Congress will be played out to the last minute when, from nowhere, a wonderful fudge will be agreed to keep things going for the time being.

There are, though, some differences from previous occasions. For example, we are seeing local state employees demonstrating against the latest state budget cuts as the realisation starts to hit home that quite a number of the US states are bust by most logical measures. Whether this realisation will be accepted though in Washington remains to be seen, as of course they have far larger numbers to deal with. These are the evil twins of the national debt and the national deficit. The US politicians generally seem to be in a state of denial, and even with those who accept there is a problem, who in the world of populist capitalism is going to be the statesman who will call for radical change with less than two years to the next election?

So what will happen? The likelihood of a QE3 and 4 cannot be ruled out as the US is still the only nation who has the ability, with its Reserve Currency status, to keep printing the stuff and if that means a weaker Dollar and shorter term inflation, then that may be a cost worth paying. Of course with all the political fears around the US Dollar, it may in fact do exactly the opposite and attract safer haven money looking for a home.

The US corporate share bulls though are excited. Corporates generally have been showing good results with lower debt levels and higher cash levels. So what can this lead to? Mergers and acquisitions (which despite the short term fanfares seem rarely to build longer term shareholder value), share buy-backs or maybe higher dividends? That of course is all very positive – but are we seeing any reinvestment in future growth? The answer seems domestically no, but possibly a greater focus on buying into overseas growth areas instead.
Phew, what a page turner.
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One encouraging area that has come about as a result of the political eruptions has been the pull back in the emerging market valuations and an introduction of some more realistic thoughts on growth and risk. There has been a growing acceptance that China cannot be just a one way bet upwards in a straight line – this goes against previous sentiment from some quarters. It has included a realism of risk about property, domestic stock market valuations and a view that whilst it may not be a bubble, it certainly may be more like a bar of Aero with lots of bubbles. With the hope from some of the support of the Chinese consumer, last week’s figures in the fall of Chinese consumer confidence may also provide a more realistic view.
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Any time the oil price goes above $100 a barrel there is always a sharp intake of breath from the media, with comments that we will be all tipped into a global recession. Well actually it is not necessarily all bad news as some areas will certainly benefit – how about the UK? At a time when we are trying to get more out of our older fields and explore deeper ones, such a higher price is exactly what is needed to add to their financial justification. Not only that but I suspect young Osborne at No 11 will be delighted and add to his enthusiasm after last week’s far more comforting government borrowing figures. Very timely for the Treasury’s Budget planning and absolutely vital if we really are going to show that growth in the UK economy can be more firmly established.
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And finally........If you think you have trouble with your family, then spare a thought for 66-year-old Ziona Chana who lives in India's remote northeast. He has 39 wives, 94 children and 33 grandchildren. They all live in a four storied building with 100 rooms in a mountainous village.
"I once married 10 women in one year," he was quoted as saying. His wives share a dormitory near Ziona's private bedroom and locals said he likes to have seven or eight of them by his side at all times.

The family, all 167 of them, consumes around 91kg (200 pounds) of rice and more than 59kg (130 pounds) of potatoes a day. They are supported by their own resources and occasional donations from followers.

"Even today, I am ready to expand my family and willing to go to any extent to marry," Ziona said.
"I have so many people to care (for) and look after, and I consider myself a lucky man."

Ziona met his oldest wife, who is three years older than he is, when he was 17. He heads a local Christian religious sect, called the "Chana," which allows polygamy. Formed in June 1942, the sect believes it will soon be ruling the world with Christ and has a membership of around 400 families.

Have a good week.

Justin

P.S. Thank you for the many kind comments both from friends and those I have never spoken to before, for my recovery from my surgery. I am delighted to say that I am nearly fighting fit and nearly some two inches taller – and no longer the UK’s largest kebab. However, the best incentive for recovery was to watch day time television – two days of which will make anyone reach for the wire cutters.
My great thanks also to my colleague Aparna Ram and our Investment Team for writing this column in my absence and for significantly raising the standard.