Playing the Saddam Gap

There is also option expiration coming so this will be interesting. The better option to play is figure out how it affects the sectors and then play them e.g. the security companies took of after 9-11 and had multi month rally. So I am looking for sector plays on this one.
Soem sector plays I have on my watch list are gold and silver, oil and energy and retail.
 
Doesn't seem like a big deal. IRAQ hasn't been weighin on the market for months. In my mind it doesn't change anything over there either. My guess is the attacks don't let up and that most weren't orchestrated by an old shriveld up man living in a hole.

My strategy will be to hold my shorts tomorrow and sell my longs into strength. Will sell some mutual funds too.
 
Quote from silk:

Doesn't seem like a big deal.
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I second that. I am not excited one way or the other by this news (and I have no short positions.) It seems to me that when the fugitives elude capture for months, the goverment says it doesn't matter - they have already been marginalized. But when they are finally captured, all of sudden it matters again and is a very positive development.
 
Hold your shorts and get crushed. Saddam isn't a big deal, but his capture will dramatically reduce estimates of how long US will need to stay in Iraq.

Deficit spending and dollar weakness has most definitely been holding back the market. A big contributor is fear of a long, drawn-out, expensive presence in Iraq. Perception is that now that risk is significantly diminished. Hence less dollar pressure and a higher market.

IMO, Gap won't be filling until 2004 ...

Quote from silk:

Doesn't seem like a big deal. IRAQ hasn't been weighin on the market for months. In my mind it doesn't change anything over there either. My guess is the attacks don't let up and that most weren't orchestrated by an old shriveld up man living in a hole.

My strategy will be to hold my shorts tomorrow and sell my longs into strength. Will sell some mutual funds too.
More...
 
I never cease to be amused by the certainty that so many people have over their opinions. Thank you one and all for reminding me on trading is NOT about.
 
Very good analysis IMO...this should also help bring more Iraqi's onboard to help build up their own country without the fear of saddam. This is a MAJOR psychological event for the Iraqi people!

Chris
 
Most likely it will be another case of buy the rumor, sell the news. Since the capture of Saddam, the shorts will have less to fear in terms of these type of announcements.


shneed
 
I think it will be very interesting, at least over the next few days/week, if this was the last bit of good news, how much more is left to the upside? Other than great GDP and Christmas sales, there isn't that much more upside than the possible negatives - ie. continued possible attacks, was this a short-term spending spree that will end, fed possible hikes, US dollar continued tank forces holders of US bonds to sell and drive interest rates up etc...

on a personal level I think it is great news. Whatever happened to the guy who started it all, Osama? The government sure did a great job in getting the public to forget about him....
 
Quote from BlueHorseshoe:

Hold your shorts and get crushed. Saddam isn't a big deal, but his capture will dramatically reduce estimates of how long US will need to stay in Iraq.

Deficit spending and dollar weakness has most definitely been holding back the market. A big contributor is fear of a long, drawn-out, expensive presence in Iraq. Perception is that now that risk is significantly diminished. Hence less dollar pressure and a higher market.

IMO, Gap won't be filling until 2004 ...
More...

'zactly! For the institutional players, Saddam's capture is a nice morale booster, but it will not alter our economies underlying issues. I don't think the big guys have their eyes on Iraq any more...

Hussein's capture is huge because it may lead to less deaths of our troops, but I can't see it ramping up the market significantly.

Furthermore, even though this will be undoubtedly be a boost to the Bush campaign, I don't think the markets care since the Bush administration has only contributed to the deficit. I just don't see any big financial or psychological impact coming from his capture.

That said - I hope I'm wrong!
 
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