if and when the US strikes, how do you think the markets will react? both immiedately and long term... and more importantly do you anticipate a rally when the war begins, after the war is over or neither???
I would suspect that the markets will sell off since so many people seem to think that the markets will rally.
so are you implying that it will oscillate in a channel until the war is over then break either up or down???
I too don't think there will be any significant rally because fundamentally there is no reason for it. For the market to rally long term traders and investors would have to take long positions. Why would they do it, just because of war? I believe the market is more likely to rally when the war is over, but not before.
The beginning of the war (or removal of Saddam by other means) takes out two things weighing on equities: - the uncertainty that currently exists regarding Iraq (don't forget U.S. credibility is on the line here too) - over-inflated oil prices. Apparently the result of speculation, as there appears to be no supply problem causing the rise in prices. So, I think an immediate rally. Russia has already expressed concerns about oil potentially going sub-$21 after the war is settled and Saddam is gone. Low energy prices very good for the world economy, not to mention the foreign policy victory (assuming a quick victory in Iraq which is very likely) is good for Bush's political capital, as he pursues investor-friendly and "supply side" policies, so I think Saddam's removal results in higher equity prices both long and short term. Although this should not be used as a justification for a war, the only moral justification should be for the protection of the U.S. and its citizens.
That you may be contemplating a deeper implication to market flatulence is outrageous - LMAO. Channels? "Don't tell me. It might mess up my mind. I don't know about those things, and I don't want to know." Blue