ISIS/IS and Islamic Fundamentalism Threaten Global Stability and the World Economy

By Victor Sperandeo With the Curmudgeon




Director of U.S. National Intelligence James Clapper told the Senate Armed Services Committee this Thursday that "when the final accounting is done, 2014 will have been the most lethal year for global terrorism in the 45 years such data has been compiled."


Clapper said that in 2013, about 11,500 worldwide attacks killed about 22,000 people. But in the first nine months alone of 2014, he said, preliminary data from a University of Maryland research unit show nearly 13,000 attacks killed 31,000 people.  Half of those attacks and fatalities were in Iraq, Pakistan and Afghanistan, he said. He said the "Islamic State" conducted more attacks than any other terror group in those first nine months.


Approximately 180 Americans have been involved in various stages of traveling or trying to travel to fight in the region for the Islamic State.  Clapper said more than 3,400 total western fighters have gone to Syria and Iraq. He estimated there are between 20,000 to 32,000 fighters in the group, coming from many different countries (see Curmudgeon's Note below for the possible reasons).


The Clapper testimony came as Congress focused attention on what's being done to defeat the Islamic State -- at all levels of government -- as more cases surface of westerners trying to link up with the terror network, including a disturbing incident out of New York City where three suspects tied to the Islamic State were apprehended last week.


Islamic State fighters recently kidnapped nearly 300 Assyrian Christians – including about 30 women and children -- near Qamishli, Syria. Judging from the grim experience of previous victims from the Yezidi sect, the men can expect forced conversion to Islam or execution while the women become sexual slaves.


The news is so voluminous on "ISIS/Islamic State/ISIL" that we try to provide some clarity in this post. Victor examines what the terrorist group stands for, its greater goals, and how it might affect the world economy if left unchecked.  We also analyze ("radical") Islamic fundamentalism and Sharia law, which have implications far beyond the Islamic State as they apply to self-proclaimed Jihadist groups.  Finally, Victor's conclusions are unusually chilling this week.


ISIS/Islamic State/ISIL - Agenda & Threat:


The ISIS acronym means "Islamic State of Iraq and Syria."  Often, the shortened "Islamic State" (IS) moniker is used to not restrict the group to those two countries. The Obama Administration changed the enemy's name to ISIL or "Islamic State of Iraq and the Levant."  The word "Levant" means Libya, Lebanon, Jordon, and Israel. 


IS wants to establish a Caliphate state, which would govern millions of people in countries throughout the Middle East, North Africa, and beyond.  It also wants to destroy all traces of non-Islamic culture, like artworks in museums and books in libraries.  Last week, IS destroyed a collection of priceless statues and sculptures in Iraq dating back thousands of years.  


The Islamic State currently controls thousands of square miles in Iraq and Syria, including major cities like Mosul and Raqqa, respectively.  The areas in Iraq under IS control are show in this map.    


That's not all!  IS is spreading from Iraq/Syria to Egypt, Libya, Lebanon and likely places beyond (possibly Indonesia, which has the largest Muslim population of any country).


After President Obama asked Congress to approve military force against the Islamic State on February 13th, NY Times columnist David Brooks said on the PBS Newshour: 


"I happened to be in conversation with a bunch of financial analysts this week. And I asked them, what’s the biggest threat to the world economy? And I expected them to say the Greek — euro crisis, whatever. They both independently said ISIS. If ISIS takes over the Middle East or destabilizes the Middle East, that is an economic cataclysm with human suffering."


Obviously, that would critically disrupt oil supplies and endanger our allies in the region.  If IS were to take control of them, they'd be our enemies rather than our allies!  Global trade would precipitously decline.  Iraq would surely be the first country to fall, after 12 years of U.S. involvement, heavy casualties and billions of dollars. All for nothing?


From The Wall Street Journal (August 24, 2014):


"ISIS may now be the richest terror group in the world. Through hostage taking, criminality, conquest and outside financial support, ISIS is building a war chest measuring in the hundreds of millions of dollars. It has portfolio managers, bankers and other accouterments of a proto-Treasury."


Radical Islamic Fundamentalism vs Violent Extremism:


The real debate or puzzle in the press is why President Obama does not call the terrorism of ISIS actions for what it actually is:  "Radical Islamic Fundamentalism," instead of his favorite name "Violent Extremism." 


In the purest sense "radical" is redundant. Turkey's Prime Minister Erdogan objects to the 'moderate Islam' label for his country.  He says "Islam is Islam," which is perfectly stated and totally Islamic!


Daniel Akbari and Paul Tetreault have written a new, illuminating book titled: "Honor Killing: A Professional’s Guide to Sexual Relations and Ghayra Violence from the Islamic Sources."  In this book, a very qualified Islamic scholar meticulously analyzes how sharia law and the Islamic religious concept of ghayra provide the motive and "amr bil ma'ruf" provides the detailed script that results in "honor" violence and killing.  Here's a relevant quote: 


"Further, we don’t have such a thing like — “radical Islam extremism” — many things that are said in Islam like beheading, like stoning, like flogging — they are not extremism acts, those are pure Islam."


The key point here is that the violence that is most often called "Islamic extremism” is actually (religious) "Islamic fundamentalism.”  Sharia Law is understand, practiced seriously by true believers of the Koran (AKA Quran).


In my view, no one has spoken as to why this difference between Islamic "extremism" and "fundamentalism" is important, other than "you have to name your enemy to defeat it."  In particular, why hasn't our Commander in Chief decisively addressed the Islamic fundamentalist threat- from ISIS and other Islamic terrorist groups (e.g. Al Qaeda, Hamas, Hezbollah, Islamic Jihad, Jemaah Islamiyah, Lashkar-e-Toiba, Pakistan Taliban (possibly state sponsored), and many more.)? 


Here's an article reviewing Obama's statements on the ISIS threat over the past year.  Do they seem to be tough enough to counter the terrorism threats from this radical group?  Could our President Barack Hussein Obama secretly be a Muslim or at a minimum a Pro-Muslim sympathizer?


Radical Islam Fundamentalism:


To understand Islam as dictated by "Sharia Law" and the Quran, which is what Islam is ruled by, one has to go by the laws of Islam. It is not a "peaceful religion."


The Quran contains at least 109 verses that call Muslims to war with nonbelievers for the sake of Islamic rule.  Some are quite graphic, with commands to chop off heads and fingers and kill infidels wherever they may be hiding.  Muslims who do not join the fight are called 'hypocrites' and warned that Allah will send them to Hell if they do not join the slaughter.


Radical Islam means a strict execution of the laws of Islam ideology. It specifically pinpoints Islamic laws like:  "Muhammad declared that there shall be no punishment for murdering anyone who disparages, abuses or insults him (tashtimu, sabb al rasool)."  That translates into "It's OK to kill someone who disparages or insults Muhammad," i.e. the Charlie Hebdo murders in Paris, France. 


Other Sharia law rules worth noting:


·       Criticizing or denying any part of the Quran is punishable by death.

·       Criticizing or denying Muhammad is a prophet is punishable by death.

·       Criticizing or denying Muhammad is a prophet is punishable by death.

·       A Muslim who becomes a non-Muslim is punishable by death.

·       A non-Muslim who leads a Muslim away from Islam is punishable by death.

·       A non-Muslim man who marries a Muslim woman is punishable by death.


The above rules are to apply to all people of the world.  That's radical to most, but it's specific to Islam. 


The term "Violent Extremism" can apply to "anyone," such as American gangs like the "Bloods and Crips" or "Hell’s Angels."  It means "violence" of any kind e.g. homicide, or a beating while committing a mugging.


Extremism is defined as "away from the normal." It has nothing to do with terrorism.  Yet a violation of Islamic religious (Sharia) law, i.e. not obeying them, may be punishable by death as Sharia law requires.  For example, many Muslims accused Salman Rushdie of blasphemy or unbelief in his novel "The Satanic Verses," which was first published in the United Kingdom in 1988. In 1989, Ayatollah Ruhollah Khomeini of Iran issued a fatwa ordering Muslims to kill Rushdie. Numerous killings, attempted killings, and bombings resulted from Muslim anger over the novel.


Few realize that "beheading" in Islam is normal Sharia Law punishment.  However, burning someone alive (as ISIS did to the captured Jordanian pilot) is radical and actually against Islamic law because cremation is forbidden.


Goals and Objectives of ISIS:  Religious or Political?


The real issue with ISIS is they are promoting a Jihad (Holy War) against the West and all other religions (which are not Sunni Muslims) by forming a Caliphate that grows and spreads everywhere in the Middle East, North Africa and likely beyond.  If this isn't stopped it will continue to get worse as ISIS gets bigger, stronger and richer.


Some say the goal of ISIS is to get the world to believe in Allah and the Prophet Muhammad to be accomplished by the saying:  "You'd be amazed what you'll agree to when you're on fire." 



NOTE:  The Curmudgeon believes that IS is using a perverted and grossly distorted interpretation of Islam to progress their political agenda of imperialist domination.  In effect, they are a criminal cartel that has no notion of religion and is using "Islam" as a calling card to attract disenfranchised Middle East Muslims (i.e. Iraq, Syria, Egypt, etc.) to their cause. The group’s extreme brutality and flare for publicity account in part for its appeal to disaffected Muslims in Europe (i.e. UK's Jihadi John, et al).


The overwhelming majority of those killed by IS were innocent Muslims who had NOT insulted the Quran, Allah, or the Prophet Muhammad! In addition, cremation is forbidden in the Quran yet the captured Jordanian pilot was burned alive by IS.  Please email me if you'd like additional perspective and comments.



For a greater true understanding of "Islam being Islam," I recommend you read the article "What ISIS Really Wants," by Graeme Wood in the March 2015 edition of The Atlantic Magazine.  It's a comprehensive analysis of Islam and very well done, in my opinion.


President Obama on Islam:


I believe that President Obama likes to misrepresent Islam.  The Quranic verse the President often quotes (5:32) states:  "Whoever kills an innocent, it is as if he or she has killed all of mankind."   Is that his proof Islam is a religion of peace?


Note that Quran verse 5:32 condones killing those who murder Muslims and "wage war against Allah or spread mischief in the land."  Mischief is defined as "treason against Allah and verse 5:33 calls for guilty infidels (of mischief or treason against Allah) to be beheaded.   Obama skips this part. See "Obama Misquotes Quran: Was He Perverting Islam" by Paul Sperry IBD editorial 2/15/15) for more on that topic.


Victor's Conclusions:


The recent State Department comment from Marie Harf said the issue is "these ISIS (barbarian) recruits need jobs to solve the problem."


In my opinion, that is perhaps the stupidest and/or highest order of "balls driven propaganda" comment I ever heard from a government official as an excuse for a problem of war.  Vying for that honor was Secretary of State John Kerry's statement last week that "we have not been safer in a century."


Yet as the Curmudgeon noted at the beginning of this article, U.S. Director of National Intelligence James Clapper said that political instability, mass killings, etc. are at highest rate in decades.  What a contradiction!


I have to observe that this administration, along with the Nixon era, is the most corrupt and lies as a matter of policy, with the belief that the end justify the means.  [Curmudgeon: Let's not forget about our dysfunctional/do nothing Congress, e.g. last minute passing of bill to fund Dept. of Homeland Security--but only for one week.]


We are living is a period of accelerating decline of freedom and liberties as well as economic decline for the average person in the U.S.  For most workers, real wages have barely budged for decades. Therefore, allowing ISIS to expand can only have dire consequences for our country and the rest of the world.


Perhaps, we should all remember the words of this appropriate song - I'm Forever Blowing Bubbles - from 1919:


I'm dreaming dreams,

I'm scheming schemes,

I'm building castles high.

They're born anew,

Their days are few,

Just like a sweet butterfly.

And as the daylight is dawning,

They come again in the morning.


I'm forever blowing bubbles,

Pretty bubbles in the air,

They fly so high,

Nearly touch the sky,

Then like my dreams,

They fade and die.

Fortune's always hiding,

I've looked everywhere,

I'm forever blowing bubbles,

Pretty bubbles in the air.


Good day and good luck! 





1.  ISIS vs. Al Qaeda: Jihadism’s global civil war


2.  Brookings Institution video on the roots, origins, and evolution of the Islamic State  


Till next time...


The Curmudgeon


Follow the Curmudgeon on Twitter @ajwdct247

Curmudgeon is a retired investment professional.  He has been involved in financial markets since 1968 (yes, he cut his teeth on the 1968-1974 bear market), became an SEC Registered Investment Advisor in 1995, and received the Chartered Financial Analyst designation from AIMR (now CFA Institute) in 1996.  He managed hedged equity and alternative (non-correlated) investment accounts for clients from 1992-2005.

Victor Sperandeo is a historian, economist and financial innovator who has re-invented himself and the companies he's owned (since 1971) to profit in the ever changing and arcane world of markets, economies and government policies.  Victor started his Wall Street career in 1966 and began trading for a living in 1968. As President and CEO of Alpha Financial Technologies LLC, Sperandeo oversees the firm's research and development platform, which is used to create innovative solutions for different futures markets, risk parameters and other factors.

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