A Region Speaks


In times of political instability financial capital leaves first; hard assets in the form of hard currency, gold, silver, platinum, and diamonds, leave second; and human capital leaves last, often with personal property strapped to its back or stuffed into suitcases. Land, meanwhile, never leaves. This has always been true, but it has become even more true in the electronic age and the emergence of “quick-silver capital.” In other words, the most sensitive leading indicators of political instability are a region’s financial markets. By those standards, widespread predictions that a second Gulf war would cause “instability in the region” turn out to have been greatly exaggerated.

Let’s say you’re a dove who happens to be managing his own portfolio, and like most doves you have been dutifully reading the New York Times and concluded, based on their reporting and analysis, that Operation Iraqi Freedom would cause a terrible destabilization in the states near to or adjoining Iraq. In fact, you placed so much confidence in the “newspaper of record” that you decided to pull all of your capital out of the Middle East. Here’s what you missed:

In the month following March 17 (the day of Bush’s final ultimatum to Saddam Hussein), Egypt’s stock market, the CMA, rose by 5.8%; Israel’s TA-100 gained 15% gain; Turkey’s ISE National-100 rose 17.8%; and Iran’s TEPIX climbed 6%. BuzzCharts would like to point out that this represents only one month’s gain. Good thing you didn’t short these markets.

Buzzchart’s conclusion: Operation Iraqi Freedom not only created higher asset values in American and European markets, but it created wealth in the Middle East as well. Does anyone know the name of a good stockbroker on the Korean Peninsula?

— Jerry Bowyer is a talk show host on WPTT radio in Pittsburgh, Pennsylvania. He can be reached through


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