Investment Implications with Syria

It looks as though Obama, the so-called peace president, is going to start dropping bombs on Syria soon.  Of course, there is no declaration of war, as there hasn't been since World War II.  There isn't even a pretend resolution by Congress this time.  Dictator Obama and his cronies in the military industrial complex have taken it upon themselves to order an attack.

The U.S. government is accusing Assad, the president of Syria, of using chemical weapons to kill people.  I'm not so sure what is so special about chemical weapons.  Is death any less bad when it happens from a nuke or drone bombing, both of which the U.S. government has used against innocent civilians?

So in order to get revenge on Assad for supposedly using chemical weapons, Obama and company are going to drop bombs and murder more innocent civilians.  That will teach those people.

Of course, the whole report is probably false.  How do we know that chemical weapons were really used?  How do we know it was Assad who did it?  How do we know that it wasn't the rebels in Syria? How do we know it wasn't a false-flag operation by the U.S. government?  Almost everything Obama and company say are lies, so why should we believe anything?  Most of what the mainstream media reports is simply a repeat of what the government told them.

The good thing is that I don't think most Americans are going to get suckered in this time.  These are the same made up stories that Bush told about weapons of mass destruction in Iraq.  I suppose Chuck Hagel is playing the part of Colin Powell.

So what about investments?  In the big picture, this is just another minor war, at least to Americans.  Of course, there is always the possibility that it could blow into something bigger in the Middle East, particularly if some country starts lobbing missiles into Israel.  If things start to get out of control, then I expect gold and oil to do well.  With all of the prior monetary inflation, these two commodities are ripe for big gains, so a trigger event like war in the Middle East is the perfect excuse for investors to jump in.

The stock market has been down lately.  Some headlines were blaming the news in Syria on the fall of stocks.  I'm not so sure this is the case, but we can't be certain.  I would not be shorting stocks because of what is happening in Syria.  Perhaps there are other good reasons to short stocks, but I don't think a war in Syria is one of them.  In the past, wars have not necessarily hurt the stock market.

Some might speculate that this coming war with Syria is a distraction from the bad economy.  I actually don't really think this is the case because the politicians in DC are clamoring for war even when the economy isn't in really bad shape.  Obama is simply part of the establishment and they will always push for more war.  It is an exercise in power.

If Syria turns into something bigger, this will do more long-term damage to the economy.  Everything has to be paid for in some way, whether it is higher taxes, more borrowing, or more inflation.

In conclusion, intervening in Syria is a huge mistake, but we have to face the reality that it is likely to happen at this point.  I think defense stocks may do well, but I would stick with gold and oil.  I am already bullish on gold and oil and this could be a spark for the start of a new rally in both.  It might also be worth looking at gold stocks, as these have been really beaten down in the last couple of years.