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On War, Technical Analysis vs Geo-Politcal Knowledge

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July 18, 2008 – Comments (6) | RELATED TICKERS: SKF , SRS , GLD

"No nation has ever benefited from a prolonged war" 

Sun Tzu's Art of War

I do not use technical analysis, besides a glance at a chart and a trend. Although I will usually not "fight a trend". My view of technical software is stolen from the gurus in the book Market Wizards, most call technical analysis software available to the public worthless. I think technical analysis might work for some people and I do not doubt that GS etc, have some super computers that produce some accurate/useful data. But the software available to the average stock trader is near valueless or worse, IMO.

The “premier technical tool” Black-Sholes model, bankrupt LTCM, and their "the best and brightest" employees, the Geo-politics of Russian default threw in a "black swan", their computer model could not compute.

I think the war, its costs and the fall out are the biggest driver of the market today. If Israel attacks Iran you can expect a major shift in the US market, as oil may go $200-400 a barrel. The NEOCONS, who pushed for the war in Iraq also want a war with Iran. The price of oil impacts almost all US publicly traded companies. How many "investors", have this scenario allocated in their portfolio? What is the risk/reward of being long "Best of Breed" if the attack occurs?

I have a few websites I go to, to look for geopolitical and war related discussions, I figured I would share. 

1. Shrapnel by Colonel Robert E Bartos is candid, hard hitting with an outstanding Geopolitical perspective. Col Bartos used to write for Col David Hackworth. He writes once a week, almost all his posts are worth a read. 

Vexations of Colonialism – GW Bush in Iraq

http://mangoparchia.blogspot.com/

http://mangoparchia.blogspot.com/2008/06/blood-oil-sand-bomb-bomb-mccain-bomb.html 

2. Fredoneverything.net by Fred Reed. Candid and funny Fred is one of the leading American philosophers. His website has a record of 7,735,334 views. FR is a well traveled former Marine and Vietnam vet. He was a reporter for Soldier of Fortune Magazine and a police reporter in DC.  All Freds’ posts are worth a reading. I was going to pick three, but just read them all, seriously….

Israel, AIPAC, and God Once Again, Fred Solves World Problem

http://www.fredoneverything.net/FOE_Frame_Column.htm

William Lind: Archives – William Lind is an expert of Fourth Generation warfare. He follows the war and writes candidly. Almost all his posts are worth reading:

http://www.lewrockwell.com/lind/lind-arch.html 

The Coming American Defeat
William S. Lind on what can happen when the US aggresses against Iran.

Why the Depression Is Not All Bad
It will rein in the empire.

A Problem for Future Neocon Invasions
Victim countries may adopt the Saddam strategy, says William S. Lind.

Gary North at GaryNorth.com Gary North is a self made millionaire and businessman. GN has wisdom, candor with a background in economics and religion. Gary North is expecting an attack on Iran (I will post later). I pay for Gary North’s website. He posts/writes four times a day. He also writes weekly for free here:

http://www.lewrockwell.com/north/north-arch.html

The Israeli Hot Potato
And $400 oil.

What Would Jesus Steal?
Gary North on Murray Rothbard, Jim Wallis, and the Social Gospel.

Terrifying Economic Plans
Gary North on old Keynesian dogs and their old fiscal tricks.

UN Inspector Scott Ritter

 

6 Comments – Post Your Own

#1) On July 18, 2008 at 9:12 AM, abitare (35.54) wrote:

FOX ATTACKS: Iran

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#2) On July 18, 2008 at 9:19 AM, abitare (35.54) wrote:

Congressman Ron Paul on Iran Situation (3-15-06)

 

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#3) On July 18, 2008 at 9:25 AM, abitare (35.54) wrote:

Ron Paul, Republican Debate: Iranian Threat

 

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#4) On July 18, 2008 at 10:54 AM, Schmacko (66.60) wrote:

http://ebird.afis.mil/ebfiles/e20080717615575.html 

Opinion piece from yesterday's earlybird.  The writer goes into detail about what he believes it would actually take to cripple Iran's nuke program and ability to retaliate.  I tend to agree with what he says would be necessary.  I also don't think the administration has the desire to go through all those steps.  nor would the public stomach it. 

Sending new high ranking diplomats to Iran should also guarnatee another few months of posturing and negotiating without any military confrontation erupting.  Apparently this is disheartening to neo-cons like UN rep John Bolton (who is an idiot). 

The economist intel unit did a pretty good country report on Iran (requires paying money to view) and they broke down how it's in Iran's best economic interest to deescalate tensions as much as possible.  Their crazy president is causing a good deal of inflation in the country by constantly increasing spending and yet hamstringing Iran's central bank from being able to deal with it by tightening interest rates.  He really hasn't come through on his populist promises that helped get him voted in and he has another election coming up in the middle of next year.  Iran's been trying to slowly privatize some of it's business but is having a hard time finding investors due to all the economic sanctions.  Total and Shell (?) backing out of the LNG project was a pretty big blow as well.  There are chinese, russian, and indian companies that would like to move in and work with Iran on petro products but they don't have the technical expertise of western firms and Iran knows that. 

I'm of the opinion that Iran developing a nuclear bomb is eventually inevitable.  The chances of them doing so soon are not good.  They are of no real current direct military threat to the United States.  I really think the chances of the US starting a war against Iran before Bush leaves office are slim to none.

Israel is of course a wildcard, but Israel doesn't have the capability to knock out Iran's nuke program all by it's lonesome.  If the US lets Israel know that it won't back Israeli air strikes I think Israel will be forced to back down.  When you're a pariah state alienating your few allies generally isn't a good idea.      

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#5) On July 18, 2008 at 11:19 AM, abitare (35.54) wrote:

Schmacko,

Great reply. My belief is the attack will not happen by the US. My guess is Israel would kill the "Golden Goose" which is an amazing amount of US financial aid. However, many believe the attack will happen in order to isolate and bankrupt the Iranian regime by forcing it into a confontation with the US.

The largest positions in the market today is long oil/commodities and short the US dollar. People are expecting/hoping? there will be an escalation eventually.

If the dollar collapses, it will erase much of the US debt, I think there are those, who want that outcome.

Also take read here: 

http://jameshowardkunstler.typepad.com/

 

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#6) On July 19, 2008 at 9:00 PM, lquadland10 (< 20) wrote:

Oh Aba, Hey, how are you? Don't people get it.The pope was here and talked to bush privetly. Obama is a cousin to Chaney he will get the election.    Oh yea it is changing all right.        The Leaders want power  and money. The people  of the world want  peace.         Always  be on the look out.    The Abuse of Power & the Assault on Democracy      Don't look at charts just figure out the lay of the World. Thanks for letting me know how to use y tube. Fool On. 

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