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Review of Ian Bremmer's "The Fat Tail"

Ian Bremmer, President of the Eurasia Group, the world's preeminent independent risk control consultant, passed through town last week to promote his latest book, The Fat Tail: The Power of Political Knowledge for Strategic Investing.The book details how money managers must become cognizant of and deal with foreign laws, regulation, government turnovers, civil unrest, expropriation,terrorism, and war, in order to survive in this increasingly complex and interconnected world. Globalization has ground to a screeching halt. Governments are now more important than multinationals in influencing our economic future, and a new form of "state capitalism" is emerging. We are shifting from a unipolar to a non polar world. Iraq is morphing from war into a peace keepingoperation, while Afghanistan is rapidly moving in the opposite direction. Geopolitical risks are rising. With crude at $52 a barrel there is no Iran premium currently in the market, and $20-$30 could price in very quickly. China and Brazil are the long term winners in the new set up, and the dollar is the big loser. The greatest risk to the US is its over dependence on borrowing from China. This is a must read book for any hedge fund manager struggling with his global risk exposure and looking for some great long term plays.