Bruce Pile

AWACS Prep In Iran Theater?

Taxi (one of my favorite TV shows of all time), funny you should mention seeing signs of the attack in the technical condition of certain related stocks. I have been researching just that very thing. I am not seeing any market reaction to the Iran situation. There's the obvious oil/gold market, no linkage evident there - yet. But if you consider how desensitized we've become to the whole WMD thing since the U.S. went into Iraq nearly 10 years ago and found nothing, another area of interest in the market is the bioweapon and chemical weapon defense stocks. If you remember, 9/11 produced a tanking stock market, but the terrorism defense stocks typically surged dramatically. There may be another dramatic focusing of the market's attention to these same stocks, many of which are in much better shape now than then. Iran has chemical weapons. An Iranian weapons stockpile was recently disrupted in Lebanon releasing some of this material killing several people. If Israel does a strike on Iran, the retaliation may involve threats and/or some use of their WMD fare.

I am going to post a piece on some of the gold, oil, and military stock reactions to past flare ups in the Middle-East at my blog and discuss some related stocks. If Jim Cramer is right about the aerospace/defense sector being in for a bull market, some of these stocks look good with or without trouble in Iran (as does gold).