-- Posted Monday, 14 September 2009 | Digg This Article
| | Source: GoldSeek.com
Rick’s Picks
Monday, September 14, 2009
“Phenomenally accurate forecasts”
We’ve always believed that the stock market’s ups and downs are driven not by anything so mundane as news events or the economy, but by the same mysterious cyclical forces that govern the physical universe. Nevertheless, two rapidly evolving news stories threaten to abruptly reverse Wall Street’s heedless bear rally, which recently entered its seventh month.
The first story concerns the impending collapse of the Obama presidency. Although he ran a very impressive campaign, Mr. Obama appears hell-bent on committing political suicide. The President is clearly obsessed with radically revamping the country’s health care system. But his relentless efforts to do so have turned many voters against him,
Including some who supported his election bid. Most recently, a Republican congressman drew heat by calling Mr. Obama a liar during a health care address to the nation. However, it bears mentioning that there are some in his own party, most notably U.S. Sen. Dianne Feinstein, who have said the same thing, more or less, but more tactfully – i.e., that Mr. Obama’s numbers are not to be believed or trusted.
Russia No Ally
The other developing story is the looming showdown with Iran, which last week said it will not be persuaded to give up a uranium enrichment program that’s making the rest of the world extremely nervous. Mr. Obama had stated during the campaign that the U.S. and its allies would not stand by idly as Iran developed nuclear weapons. However, it is now clear that Russia, an absolutely crucial ally in any sanctions that might have been used against Iran, will not lift a finger if the mullahs continue to churn out weapons-grade uranium. Last week, Russia’s foreign minister asserted that Iran’s nuclear program posed no threat to the rest of the world, echoing thoughts believed only by America’s enemies or those so completely blinded by their hatred of Israel that they perceive Ahmadinejad and the mullahs as the good guys.
Concerning Mr. Obama political future, if failure seemed merely imaginable a few months ago, it looks likely now. He has staked his political credibility on a health care plan that looks nearly certain to go down in flames. Even worse, he keeps trying to ram this legislative sausage down the throats of tens of millions of Americans who have grown increasingly skeptical with each new public relations push. If successful politics means knowing when to hold ‘em and when to fold ‘em, Mr. Obama has pushed all his chips into the pot with nothing but a low pair. When his health care sausage turns putrid, he’ll have no political capital left to push through the most ambitious and costly political agenda in the nation’s history.
A Rudderless U.S.
At best, the U.S. would then be without a rudder; at worst, in a rapidly deteriorating economy, there could be political and social chaos. Even then we could probably find a way to limp to the next election. But the situation involving Iran will not long abide Mr. Obama’s stall tactics. The only credible threat the President can use against Iran in the meantime is the assumed willingness of Israel to launch a pre-emptive strike. There was a time not long ago when no one would have thought Israel capable of attacking Iran without direct help from the U.S. Now the U.S. is saying it may not be able to hold Israel back.
This seems like more than a mere shift in rhetoric. In any event, if there is a blow-up with Iran, or if Obama is about to become a lame-duck president in the midst of severe economic decline, it bodes ill for Wall Street. We doubt that many investors are ready for the change, which could come without warning.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2009, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Monday, 14 September 2009 | Digg This Article | Source: GoldSeek.com
