Suddenly, Wall Street is obsessed with something that used to be an after thought

While the world was at peace — before the financial crisis, war in Eastern Europe, and chaos in the Middle East — Wall Street’s masters of the universe could keep geopolitics in the recesses of its mind.

No more.

Now global unrest has become the central worry of bank executives and hedge fund billionaires alike. It’s the new uncertainty slipping into conversations even when money isn’t necessarily at play.

“Greece is a more a humanitarian issue than an economic one,” said Mary Callahan Erdoes, JP Morgan Asset Management CEO, at CNBC’s Delivering Alpha Conference on Wednesday.

But on a panel including Erdoes, two hedge fund managers, and a California pension fund’s Chief Investment Officer, it was that humanitarian crisis that dominated conversation.

Richard Perry, the billionaire CEO of hedge fund Perry Capital, said that issues in Greece are exacerbated by the country’s “adjacencies.” By that he meant more simply, it’s geography.

If Greece, a NATO member, turns to an aggressive Russia for help, Putin’s influence in an already fragile region will increase. Greece’s historical enemy, Turkey, is also becoming more and more authoritarian. Greece is also susceptible to spill over from Syria, Perry argued.

The spillover isn’t just coming from Syria either. Violence in the Middle East and North Africa has sent desperate refugees — and far more dangerous migrants, some fear — to Europe en masse. It’s a challenge the EU can only take on if it does it together.

But the EU, it seems, is coming apart. Perry wondered which EU nation “the next Syriza Party come out of,” referring to Greece’s radical right wing party.

Suffering over time leads to desperation. Desperation leads to radicalism. This is a domino effect that doesn’t just end with Greece’s bailout. To Perry it seemed Germany forgot about that in its negotiations with Greece, luckily France and Italy did not.

Ultimately moderator Andrew Ross Sorkin had to turn the conversation back to actionable trades. That’s rare on Wall Street, where earnings trump elections and risk is measured and modelled in Excel. It shows you that we’re living in a particularly dangerous time.

The urgency of these kinds of discussions has increased dramatically even since this spring, too, when investors gathered in Las Vegas for SkyBridge Capital’s SALT conference.

Then, Putin and Russia were a problem for Ukraine. Attendees talked about the conflict as more of a worrisome curiosity than an immediate risk.

Now, with Greece on the brink, Putin’s specter is moving west toward a weak and squabbling Europe.

Ultimately, it was Perry who nailed the key way that this will new obsession with geopolitics will change how Wall Street goes about its business. He was talking specifically about China’s now-sluggish economy and its whip-saw stock market, but it applies across the board.

“The way to play the game is to understand what the Chinese are doing,” he said.

That goes for oligarchs in Russia and politicians in Germany, fighters in Syria and protestors in Spain.

It’s time to pay attention.

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