The beheading of 47 political prisoners -- terrorists -- by the House of Saud may trigger a formal war between Iran and Saudi Arabia. The ayatollahs in Iran want control of Mecca and Medina, which are now in Saudi hands. This is the heart of the Islamic War, although there are plenty of other issues and frontlines.
The House of Saud sits on oil, and as oil prices dropped -- thanks to hydraulic fracturing and the onset of another global recession -- the Saudis are in trouble. The sheiks pacified their populations with an Arabian socialism (Iran and Iraq did too) that the Sauds no longer can afford. To scare people into obedience, the Saudis began cutting off heads. This led to Iran -- which pushes dissidence in Saudi Arabia to undermine the government -- to burn the Saudi embassy, and in response, Saudi Arabia cut diplomatic ties.
Bahrain, Sudan and the United Arab Emirates official sided with Saudi Arabia today. It is the Sunnis (Saudi Arabia) versus the Shia (Iran). And it comes when the Saudis are running out of money. They are cutting social security.
Saudi Arabia's finances are getting slammed by the crash in oil prices.
The government spent way more than it collected in 2015 -- leading to a budget deficit of nearly $100 billion.
Oil accounts for 75% of Saudi Arabia's revenue, and when crude prices were sky high, the country enjoyed frequent budget surpluses. Now oil has collapsed below $35 a barrel, compared to over $100 in mid-2014.
Saudi Arabia also said it spent more than expected on social security benefits and salaries for government workers and military members.
As a results, cuts are coming: The budget calls for a 14% reduction to 840 billion riyals ($224 billion), down from 975 billion ($260 billion).
Saudi Arabia is even thinking about cutting the massive discount it gives its citizens on gasoline. The Ministry of Finance confirmed it is "reviewing" a change to government subsidies on energy, water and electricity.
Saudi Arabia revealed other steps to fix its finances, including implementing a budget ceiling, reviewing public spending on projects and training 3,500 workers to improve the government's accounting practices.Saudi Arabia may soon be Detroit with oil and men in sheets.
The likelihood of a formal Saudi-Iran War is rising, as is the probability of Saudi Arabia suffering a civil war. President 45 is going to have to deal with this, and President 44 is going to leave him with a weakened military, adversaries who mock us, and allies who no longer trust us.
Oh, and as the stock exchanges are showing today, President Obama will leave an economy in the crapper as well.