Current Geopolitical Risks

1. Ukraine / Russia - since 2008 Putin has been stirring up instability, culminating in the take over of Crimea and now muscle-flexing in eastern Ukraine. Russia found a $400b friend via China, more than making up for the western sanctions. 

2. China / Japan - Senkaku Island have been despited for a while but with China forking over $400b to Russia, lines are being drawn. The US has now sided with Japan, and China keeps provoking with ship attacks and close military fly-overs.  

3. Iraq (Mosul) - threatens to escalate with Trukey willingness to intervene to protect its citizens, and Iran entering to provide 'assistance'. (There are interests to be protected in the north, and the US maybe forced to intervene.)

4. Syria - the level of life lost is horrible but the threat of engulfing multiple countries has mitigated. (Although with any war, things can change quickly.)

5. Pakistan - increased bombing leaves a high degree of uncertainty. 

The above is simply the obvious issues. 

# 1 and 2 are escalating each other. # 4 was already causing a light rift with Russia.

The vix has elevated over the last few days, but not enough to fully appreciate the Russia-China rift developing and the threat instability in Iraq can cause.