We live in a very dangerous and risk-filled world. We received very fresh evidence of that with developments throughout the Middle East and northern Africa over the last 24 hours.

Strained relations with our supposed closest ally in the region are more than enough to occupy our attention. The fact that our embassy in Cairo, Egypt and our consulate in Benghazi, Libya were attacked and our ambassador to Libya was murdered is a sobering dose of reality as to how the United States is viewed by many in this part of the world.

While cooler and calmer heads should and hopefully will prevail during this period of stress, let's make no mistake, the attack upon our embassies and the murder of our ambassador, Chris Stevens, are acts of war against our nation. Do you think that all eyes around the world are focused on how we respond? No doubt. 

The British-based periodical The Telegraph poses that very question this morning in writing, U.S. Consulate Attack in Libya; Death of U.S. Ambassador Would Be Act of War,

Not only did they choose a crucial stage of the US election campaign, but the assault took place on the 11th anniversary of the terrorist attacks on September 11.

As such, President Barack Obama will come under overwhelming pressure to respond when he wakes in Washington this morning. Put bluntly, the destruction of diplomatic premises resulting in the murder of an ambassador would amount to an act of war.

When the British embassy in Tehran was attacked last November, the mob ransacked and pillaged, but refrained from physically harming any personnel. Nonetheless, London responded by expelling every Iranian diplomat and downgrading bilateral ties to the lowest possible level.

Given that America's most senior representative in Libya appears to have been killed – with some reports suggesting that three other staff also died – Mr Obama's response will have to be far tougher.

The markets remain remarkably calm this morning as they continue to operate under the massive anesthetic provided by the Federal Reserve and likely the ECB as well. That said, the world as a whole is faced not only with enormous economic risks but with heightened political and military risks as well. Not that the overall level of interest rates nor the slope of our Treasury yield curve are able to accurately reflect those risks.

Whatever happened to peace through strength?

Let us send our thoughts and prayers to the family of Ambassador Stevens and the other American citizens who lost their lives overnight.

Thoughts, comments, and constructive criticism encouraged and always appreciated.

Navigate accordingly.

Larry Doyle

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I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.

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