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This Ain’t No Libya

12/01/11 by  
Filed under Bourbon & Bayonets

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We spoke last week about war – its near-term inevitability, ubiquity and longevity – and it appears the latest developments in the Middle East may have pushed the battle calendar forward.

With the British Embassy in Tehran sacked and bellicose statements issuing from government and media sources in London, we now see the chance of a wider regional conflagration being sparked at any moment.  And it won’t be no Libya.

Raising the Stakes

The complicating factors surrounding any Iranian-Western confrontation come from the following factors.

  • Germany, Holland and France just joined the UK in condemning the Iranian government’s sanctioned break-in of the British embassy in Tehran, but didn’t take the further step of closing their Iranian embassies as the British did.  Nonetheless these European allies will support morally, if not materially, any western action.
  • Iran has promised to launch 150,000 missiles against Israel and Turkey (!) if they are attacked by a western country or any western-led coalition that includes Arab states.  They will also seek to close off shipping lanes in the Strait of Hormuz, through which 40% of the world’s oil supply moves.

  • At the same time, an increasingly aggressive posture against Iranian ally, Syria, by both the west and the Arab League has led Damascus to state that they, too, will launch an aggressive hail of missiles against Israel and Turkey (!) if attacked.
  • Israel has promised a swift response to any attack on her citizenry, citing the need to send only one or two projectiles in return.

  • What makes the situation even more explosive is Russia’s repositioning of its single aircraft carrier, the Admiral Kuznetsov, off the Mediterranean Syrian coast, joining three other Russian warships already docked at Syrian ports, in what appears to be a bid to warn the West of intervening with Russia’s latest Middle Eastern ally.
  • America appears unmoved by the Russian threat.  President Obama recently authorized the deployment of aircraft carrier George H.W. Bush along with three cruisers and five destroyers to begin patrolling the eastern Mediterranean coast.  The idea behind seventy additional U.S. fighter bombers in the region is to provide air cover for local (Arab) parties to successfully unseat Syrian President Bashar Assad.

 

  • China’s military has stated that it will risk a third world war to protect Iran from any American attack.
  • Israel all but admits that has operational plans for the destruction of Iran’s nuclear capacity and that it will be forced to act within the next six months if it hopes to preempt an Iranian bomb.
  • Lebanese based Hizb’allah and Gaza’s Hamas – both staunch allies of Iran – appear to be provoking an early and heavy handed Israeli response to renewed missile attacks on its population centers.  This would turn the diplomatic tide away from the Syrians and Iranians and justify a missile barrage against the Jewish State (but not likely Turkey.)

Bombs Booming…

Economy Booming…

Markets Booming…

Re-election Chances for President Booming?

According to popular financial blog site, ZeroHedge (via Gallup), Barack Obama is now officially the least-approved president ever at this stage of his re-election campaign (see the links), and some believe it behooves him to pull out all the stops to turn things around.

We’re in that camp, though we’re not sure we’re so comfortable there, considering the company we’re keeping.  It appears none other than Donald Trump has also weighed in on the matter, just this week tweeting that,

“In order to get elected, @BarackObama will start a war with Iran”

In the end, however, he may not have to.

The economy and the markets are on a tear.

Economic numbers are surprising like a shark attack.

Pending home sales just shot higher on a monthly and year over year basis, beating all expectations:

Employment figures from the payroll people, ADP, also surged beyond expectations, printing 206,000 new private sector jobs on expectations of just 132,000.  The true test for jobs, however, will be Friday morning’s official Non-Farm Payroll Report by the US Labor Department.

And finally, the Chicago PMI, a bellwether measure of industrial business activity, shot up to 62.6 on expectations of 58.4.

The Bernanke Blink

With the U.S. economy starting to cook, Fed Chair Bernanke apparently felt ready  to ante up on a European bailout, and the market has been aflight ever since.

Look for that to continue at least until the first shots are fired.

And consider returning to the energy sector, maybe via some of the richer Canadian plays, like Suncor (NYSE:SU), Canadian Natural Resources (TSE:CNQ), or Imperial Oil (NYSE:IMO), all of which offer a roughly 1% dividend to boot.

 

Many happy returns,

Matt McAbby

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Comments

12 Comments on "This Ain’t No Libya"

  1. wayne on Thu, 1st Dec 2011 7:33 PM 

    Interesting, where do you get your info that the economy, housing prices, etc are on a tear? Not in this country at this time…..the only thing on a tear is the deficit….so I don’t expect any raging improvement until that problem is under control…and won’t be as long as we have Obama!

  2. Stephen on Thu, 1st Dec 2011 7:56 PM 

    Are you kidding.. About a rebound? Can you think, at ALL. I think Oakshire is way off.
    And about this isn’t Libya business, that’s right, Iran isn’t some tiny innocent arab nation.
    They are more than ready to defend Iran against the west.
    And frankly, the west can’t even save itself, (without a war).

  3. Stephen on Thu, 1st Dec 2011 7:58 PM 

    Don’t be a fool this time, vote for Gingrich.

  4. Kumar on Thu, 1st Dec 2011 8:04 PM 

    Best story teller, I give you that. Fantasy, dream on!

  5. david lewis on Thu, 1st Dec 2011 8:31 PM 

    sir: sarcastically speaking: “yeah, drop those nukes. so what if russia , china support Iran?” “we are the united states of america” “wave the flag”
    this is a disaster. and things are not great in America. Nothing is made to last. WE are Rome in it’s final days. We have given away our rights in the Patriot Act. i will not waste my vote on Obama or anyone other than Ron Paul
    He is the only one who can save our currency. (and also save us from this Military madness. ) this whole thing with Iran is a fabrication. We are the King of Nukes. How can we judge them?

  6. Michel Hebert on Fri, 2nd Dec 2011 9:18 AM 

    HiDavid

    Totally agree. Let them clean the mess they created with our support.

  7. Mike on Fri, 2nd Dec 2011 11:22 AM 

    Newly minted contra-indicator called the Oakshire Indicator…. You say BUY, I SELL….. So far in 2011 I’m profitable…

    Where Israel is concerned, I’m not losing much sleep….. They will do the Iranians just like they did Iraq and Syria… If the Iranians are stupid enough to retaliate, they are in for a HUGE awaking… Anybody notice how effective Israel has already been with the “accidents” in Iran over the past several years…..

    Need I say more?

    Mike

  8. GP on Fri, 2nd Dec 2011 12:00 PM 

    Let’s take this guy from the White House. He is worst than Carter. At least Carter cared about America. Iran has to be rendered totally innocuous now, no waiting. Same to N.Korea. Iran can pay us back for all expenses they are forcing us to incur. No more free money to anybody in the world unless they keep demonstrating complete fidelity to USA. America must demonstrate courage, force and prompt action to the world. No more vacillation. How the hell a country, that rode only on bicycles just a few years ago, is lending billion$ to America?
    We must stop making others rich, especially potential enemies.

  9. George Kanalos on Fri, 2nd Dec 2011 5:14 PM 

    I think our governemnt under Obama is a joke, in the Muslim world that is, “No Respect”, and no fear of military action either. US and the western world is facing a problem that only a strong, determined leadership will correct, and that will require a military action, and unfortunately Israel will pay the price because they will have to do it alone, unless Israel will use nuke’s to keep the Muslim world in the box, I hope I am wrong.

  10. last hoorah of an elliot wave winter bear on Fri, 2nd Dec 2011 5:39 PM 

    This is a repeat of the last century. The winners will be South America after Europe, North America and Asia turn to rubble. The year long winter coming is going to reduce the world population by 2/3. Biggest loosers will be India and China reducing to less than 1/10 their population because they will implode by the weight of their own needs. South America will be the new bread basket of the world while the rest of us clean up the radiation with what is left of us. All industrial countries will collapse from the lack of demand and the availability of recycled used equipment from the dead that will hit local markets. Big box retailers will become extinct. Local businesses will become the norm like back in the 30s.

    Only one disclaimer. If anti missile tech is better than I think because i lost track of the new star wars program that started 10 years ago then the US becomes the next Rome and completely dominates the world with a terrible vengeance the likes of which never seen in humanity. Pax Americana destroys all other cultures on a global scale. South America allies with the US making the world dominated severely and harshly. Islam becomes an extinct culture. All of Europe and Asia ally in an attempt to counteract the obliteration of their cultures.

  11. Ted Robertson on Sat, 3rd Dec 2011 7:15 PM 

    Of the half dozen or so newsletters I recieve yours is one that I actually stop to read, I mean really read, not scan but read from the first word to the last word.

    This is suppose to be the Century of Buck Rogers when the world unites in the joint exploration of space and beyond, this is the century when mankind would eliminate poverty, irradicate crime and disease, become tolerant of others customs and faiths and perfect robots and develop technology beyond mankind’s wildest expectations.

    Yet, here we sit watching our various political entities challenge one another, with weapons of mass destruction, over the ancient scourge of religious intolerance while world hunger is greater then ever among the planet’s unwashed, impoverished masses. Obviously, in places like Iran and North Korea the minions of Citizen Kane and Ming the Merceless flourish while here, in America, the dream of our forefathers is set aside as we watch Obama’s would-be Republican contenders further demean the dream of America for superfulous issues on how best to tell others how to correctly live their sexual lives and how free women’s bodies should be controlled by the state.

    Perhaps, in this era of national states threatening the peace and safety of the planet it is time we speak and discuss the subject of national state genocide for the greater benefit of the rest of us? But of course not, we’d rather the Earth’s future be determined by the zealots of religion.

  12. David on Mon, 5th Dec 2011 12:46 AM 

    Agree with Ted R. Time to envision a different way to global prosperity. Peace pays bigger dividends than war to more people. Stealing from and/or killing your neighbor does not grow the pie. Once you have seen war in the first person, you lose your appetite for solving disagreements with weapons and bloodshed. We are witnessing more economic war games for the benefit of the few but at the expense of the many. Does anyone know how to pull the plug on this game? As Matt A. said, Cold War Redux.


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