I have been writing about the black swan events that would happen and affect all of us. Most have ignored my admonitions and some have ridiculed them. Well, the big black swan landed in Paris last night and it is 9-11 all over again. While far fewer died, the impact is as great. In the words of the Pope today, WWIII is underway. We are now, and have been for several years, engaged in a world war with radical Islam, even though Obama refuses to even utter the words Islam. How can we effectively fight an enemy the president refuses to even acknowledge exists. Maybe it is because he is why we are at this point now. His weakness and his lack of a real foreign policy and defense policy has lead the world into WWIII. Create a vacuum, and the really bad guys will flow in. That is exactly what happened.

So what will all of this mean to CRE. First, nothing good. About a year ago I wrote that Europe is not a place for investment where there was not instant liquidity. It was problematic enough that the European economy and banking system were still very weak and policy makers had not done many of the things that were needed to clean up the banks. We see the result today with many of the major banks having mass layoffs. We see the Euro continuing to head to parity. Now we have the flood of Muslim refugees who will bring a few planted terrorists in their midst, and a population that does not assimilate, and does not adhere to western value systems. It will materially add to the dislocations in several countries where large Muslim populations have created areas of Sharia law and no go zones for local westerners and even the police. Adding a million or more Muslims who have no skills and no money, and are a drain on already thin budgets, is not a recipe for anything good.