The upset election of strong man Rodrigo Duterte to the presidency of the Philippines is a fascinating development in terms of the geopolitical balance in Asia. He may play a key role in the squabble over the Spratly Islands, the energy-rich chain of mainly specks of coral and sand in Southeast Asia. They are coveted and claimed by just about every nation in the region.
Duterte loves to make outrageous statements, and he has already said in a presidential debate that he would ride a jetski out to the Spratlys and plant a flag to enforce the Philippines' claim.
The Philippines and Malaysia have just about the best ones if you ask me, being the closest nations if you look on the map -- but of course, China is muscling in. The New York Times has a fascinating interactive look at how China has turned a reef into an island with a port and airstrip.
After the election results came in, Duterte backtracked on his hardline stance and said instead that he wanted to see a summit on the issue. He added that he would turn a blind eye to China's actions.
"If you want joint ventures, fine, we can get the gas and the oil," he said. "I believe in sharing."
I said last week that I believe the Philippines could be the comeback kid, emulating the underdog victory of Leicester City in Britain's Premier League this season. I still believe its business-process outsourcing industry is going to boom and steal business away from India, and that it's worth a look for speculative investors.
So far, we know virtually nothing about Duterte's economic stance or foreign policy. But his wildly inflammatory rhetoric certainly promises to shake up the diplomatic balance in Asia, where the Philippines has stood alongside Japan and Australia as key allies in the U.S. "pivot" to Asia.
Duterte has been the mayor of Davao, the largest city on the southern island of Mindanao, for years. It's next to smaller islands run by Islamic separatists, where the occasional beheading isn't out of the question.
Under the watch of "Duterte Harry," 1,000 criminal suspects have been killed by the "Davao Death Squad," according to the Philippines Inquirer. In that report, vigilantes conveniently take care of two robbery suspects by shooting them in the head while they're in a patrol car on the way to the city prosecutor's office.
If you thought Donald Trump makes outrageous statements, Duterte goes further. The mayor has admitted orchestrating the deaths. "Am I the death squad? True. That is true," he said in his television show last May. But he often makes such inflammatory comments to provoke his opponents, in that case telling them to sue him if they had a problem with his hard-man stance.
He then said the 1,000 deaths would reach 50,000 if he became leader of the country. "I don't want to be president. I don't want to kill people. So don't elect me as president," Duterte said.
So, of course, they did. At last count, he had won 38.5% of the vote. All his opponents have conceded defeat.
There's a precedent for such an outsize personality picking up the presidency. Actor Joseph Estrada led the Philippines from 1998 to 2001, until he was impeached and convicted of plundering the coffers. That's always a risk in a country that ranks No. 95 out of 168 in Transparency International's ratings. He has been forgiven, and even elected as the mayor of Manila, a position he now holds.
The boxer Manny Pacquiao has sparred in politics in between his bouts, and is almost certain to have won a seat in the senate in this election. There are plenty who would like to see him run as president, too.
It will be fascinating to watch what happens under Duterte. At 71, some question whether he will see out his six-year term. Critics say poverty is a much more pressing issue than crime.
The English-speaking standards and will to work in the Philippines should have propelled it economically since the end of World War II. But it seems the people have been constantly undermined by their politicians.
Investors can play the Philippines market through exchange traded funds like the iShares MSCI Philippines (EPHE) and the PowerShares DWA Emerging Markets Momentum Portfolio (PIE). It's early days, but there's been a bounce so far.
With a day of extra trading since the election as of the Asia close, the Hong Kong-listed Xie Shares Philippines PSEi ETF (HK:3037) is up 7.7% since May 6, propelling it into the black for the year and showing that investors are perfectly happy with the nation's choice of new leader.