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Technology Stocks : Compaq
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To: MeDroogies who wrote (93527)10/31/2001 1:24:31 PM
From: Night Writer  Read Replies (1) of 97611
 
MeDroogies,
I agree that the model should make good long term picks that may be neglected due to current war emotions. That would be the econometric model strength. The weakness would be failing to capitalize on the short term strength of war (defense) related stocks.

When I mentioned that not all war time needs are the same, I was thinking of basics like oil, steel, and rubber. During large land wars like WW II, those commodities become very valuable. A small comparative military operation like this will not drive those commodities up due to classic military needs. (This still a big expensive military operation due to long supply lines.)

There is no build up time for current modern warfare. Either you have the material ready to go or you avoid the conflict. The alternatives are: Surrender. Lose the war. Hold out at an expensive cost of human life and property until the invader gets tired and leaves the battle field.

Based on the above thoughts, current war related investments are quick short term targets of opportunity. IMHO an econometric model would need some very detail programing to make short term stock picks of that nature. Thus the fund manager making long term investments might be wise to proceed with his investment strategy as though the war does not exist.

Of course, all of this is subject to change depending on the war.<G>

NW
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