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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: marginnayan who wrote (8936)	11/28/2001 4:22:08 PM
From: Softechie	Respond to of 99280

Don't forget Bush is eyeing IRAQ now. This will shoot the market down real quick.

To: marginnayan who wrote (8936)	11/29/2001 4:23:01 AM
From: Psycho-Social	Respond to of 99280

Afghanistan & the Markets: There's plenty of precedent documenting the interaction between political/military developments and the U.S. Stock Market, even where the connection is emotional rather than fundamental, i.e. Nixon resignation marked the '74 bottom, '90 bottom coincided more or less with the greatest pessimism re Iraq's brief conquest of Kuwait, etc. In mid-Sept, the combined effect of the Market's week-long closing and the fear re terrorism brought us a major Market low. Since then, the U.S. military's crushing defeat of the Taliban has given us an exaggerated sense of our own invincibility. I believe the coming weeks/months will probably bring us closer to reality: We overwhelmed the Taliban because our military superiority, in part, but only because of their military blunder in attempting to hold fixed positions in the north until it was too late to retreat south. Equally important, we obliterated the Taliban's control over Afghanistan because the Northern Alliance, the Russians Pakistan and Iran allowed us to. Without the Northern Alliance ground forces, and the hands off attitude of Russia and Iran, our task would have been much more difficult and costly. Had Pakistan supported the Taliban officially and allowed them sanctuary, things would have gotten very messy. Yes, we've achieved our major short-term objective of removing Afghanistan as a haven for terrorists, but there will be few additional signs of progress/victory going forward. The Northern Alliance doesn't need our help much going forward, and the Seige of Kandahar could last for months. There are even some disturbing parallels to Jonestown and Waco in our approach there. The point is not to predict disasters in the future, but merely to suggest that the easy victories have been won, and the interests of the U.S. vis a vis the Northern Alliance, the Russians, Iranians and Pakistanis will increasingly diverge. We may catch Ben Laden soon, but it's unlikely that the brains behind 9/11, Ayman Al-Zawahiri, is still in Afghanistan. As reality sets in during the coming weeks or months, perhaps the Markets will also find a middle course, not so depressed as in mid-Sept, but not so cocky as in mid to late November.