Has Anyone Given Any Thought To A War With Iran While We Watch A Ho-Hum Market?

March 16th, 2012
in Gary's blogging, midday post

I don't think that many have given any special thought to war but it could be an interesting trading ploy. It would first appear that Mr. market is going to wait until war happens. It would also appear that most pundits believe war is not going to happen for another 6 months or so, if it happens at all.

First lets start with this mid-day report  with a comment that I see the market has stayed right up to the highs of the day and has not moved except for small bumps all morning and early afternoon.

Kind of scary as when a market goes sideways for too long as it has today. Markets tends to react violently in one direction or another when it does break out. I have resolved myself, sort of, that this market is going to continue in an upwards fashion for the next 30 days, at least as there has been a lot of talk about the "impressive" recovery in the US economy. But I won't bet on it either as the bear side of me is warning me that all kinds of bad things are going to happen. So long as there are no outside interferences, like that pesky Greece default or a war, the US markets should melt up some more.

However, just as I was feeling better about this bull market this comes up. The next stop is Spain of course.


@telegraph: "Greece's troubles continue. Norway's $607bn (£383bn) sovereign wealth fund - known as the oil fund as it invests Norway's tax revenues from oil and gas, has voted against Greece's bond restructuring plan "on principle".

Yngve Slyngstad, the head of Norges Bank Investment Management, is unhappy at the special treatment given to the European Central Bank, told Reuters in a interview that bondholders should have been treated equally"


And then this tidbit from Zerohedge. Fortunately I don't think anyone on Wall Street has seen it because there has been little reaction - or maybe no one cares anymore.


The Fool's Game: Unravelling Europe's Epic Ponzi Pyramid Of

Now in the curious world we live in today; this only came out in public as the answer to a question raised in the German Parliament. Some reflection on the nature of these guarantees, that the European Union had decided not to tell us about, causes me to think of them as “Ponzi Bonds.” These are the seeds of a great scheme that has been foisted upon us. Bonds of a feather that have flocked together and arrived with the black swans one quiet Wednesday afternoon.

The quoted and much ballyhooed sovereign debt numbers are now known to be no longer accurate and hence the lack of credibility of the debt to GDP data for the European nations. Stated more simply; none of the data that we are given about sovereign debt in the European Union is the truth, none of it. According to Eurostat, as an example, the consolidated Spanish debt raises their debt to GDP by 12.3% as Eurostat also states, and I quote, that guaranteed debt in Europe “DO NOT FORM PART OF GOVERNMENT DEBT, BUT ARE A CONTINGENT LIABILITY.”

In other words; not counted and so, my friends, none of the data pushed out by Europe about their sovereign debt or their GDP ratios has one whit of truth resident in the data.

Another reason I am holding a large sum of cash is the ever present danger of a conflict with Iran. I think it is too late to venture forth and take a stake in anything, long or short, any longer than the current session without incurring large risk.

The clock is ticking closer to the midnight hour regarding a strike in Iran. Israel might do it alone, but will likely have the backing of the US.

Is a war imminent, or are these moves just meant to scare Iran? Here are 5 signs that have piled up very recently.

  1. SWIFT Cuts Iran Off: The international institution responsible for around 80% of the world’s financial transactions announced that it will cut off Iranian financial institutions from its system from Saturday. This unprecedented move is a big blow to Iran, and follows up on EU sanctions.
  2. Majority in Israeli cabinet for strike: Israeli newspaper Maariv (Hebrew link, quote in English) by Ben Caspit saying that 8 out of 14 Israeli cabinet members now support a strike on Iran’s nuclear facilities. The cabinet can give Prime Minister Netanyahu the green light for a strike, at the time he sees fit.
  3. Netanyahu preparing Israeli public: The Israeli Prime Minister continues the tough rhetoric against Iran also after coming back from his long visit in the US. Analysts see this as a preparation of the Israeli public for a war.
  4. Using Oil Reserves: There was a report, later denied, that the US and the UK decided on releasing oil from the emergency reserves in order to lower prices. This could be another preparation.
  5. “Last Chance” Warning: According to Russian sources, US Secretary of State Hillary Clinton asked the Russians to send a message to Iran that the upcoming talks 6 nation talks with Iran are the last chance before military action.
Fellow traders, several commentary's have made disparaging remarks about this article, but the truth is the author might be right. The reality of war with Iran is real and shouldn't be discounted, not today anyway. Read it with an open mind of "what if".
"The Western world has edged closer to a war with Iran as the politically well-connected Russian newspaper Kommersant revealed the pivotal nature of the upcoming "Big-6" talks with Iran. The fantastic aspect about being long Russian equities, is that even if there is no war in the middle east, Russia is still poised to outperform most global markets. The Russian economy is extremely wealthy, with very little debt and rich in resources from the well known oil and gas, to soft commodities like wheat.
Written by Gary

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