After the deadliest month ever for US troops in Afghanistan, panic over this failed war continues to spread to new areas. Panic had appeared to reach a peak when Stanley McChrystal was replaced as head of ISAF and head of US Forces in Afghanistan. However, the situation continues to spiral out of control under the new leadership of David Petraeus. Dominating today’s headlines are peaceful anti-American protests in Kabul following the riot precipitated by four civilian deaths in a traffic accident involving US contractors on Friday, the departure of the Netherlands from the shrinking NATO coalition and fears on the part of Senator Lindsey Graham that an “unholy alliance” between liberal Democrats and conservative Republicans could undermine the remaining small amount of support that remains for the war.

Panic within the US government and military over the dire state of affairs in Afghanistan continues to escalate. First, in response to a constant drumbeat of failures on the military front, we had the obvious planting of the “discovery” of one three trillion dollars worth of mineral wealth in Afghanistan. Then, General David Petraeus passed out at the beginning of his Senate testimony on Afghanistan, delaying the hearing by a day. Today, however, the panic has hit its highest level yet, as General Stanley McChrystal has been summoned to Washington. The reason for McChrystal’s hurried trip to Washington, however, completely misses the mark, as he is being brought in to defend an upcoming article in Rolling Stone rather than the strategic situation in Afghanistan.

As I noted yesterday, the attitude in Washington regarding the war in Afghanistan is now at panic level. Articles in this morning’s New York Times and Washington Post reinforce that view, and in a remarkable turn of events, General David Petraeus has fallen ill this morning while testifying on Capitol Hill.

Cross-posted at River Twice Research.

The Greek debt crisis finally spilled over in full force to U.S. markets, aided and abetted by extreme statements emanating from such esteemed and prominent voices as Muhammed El-Erian of the large bond investor Pimco, who warned that Greece could be just the beginning of sovereign debt catastrophes. In the space of minutes, the major U.S. indices plunged more than 10%, fueled by the same programmatic electronic trades that were part of the battering in late 2008 into 2009. And then in the space of 15 minutes, they recovered, without – it’s fair to say – much human decision-making during that interval (and if an individual even tried trading during those 30 minutes, they would have found it difficult or impossible, as web sites such as schwab.com were completely overwhelmed with traffic).

In Douglas Adam’s Hitchhikers Guide to the Galaxy, the little electronic book has printed on it in cheery yellow letters the phrase “Don’t Panic”. This is good advice in all situations in life, but in the new environment of the post Massachusetts Special Election, it is particularly true. We have seen the signs of panic from just about the entire leadership of the Democratic Party in one fashion or another. Whether it is Speaker Pelosi whistling past the graveyard saying we will pass this bill, or Sen. Webb saying that nothing should be done on HCR until Senator Elect Brown is sworn in or whether it is the contemptible Sen. Evan Bayh, (Chickenshit, IN) saying the whole reform effort should be scrapped, they are all engaging in panic behavior.