No Fly Libya
Research for Online Investors

by John Dalt

3/18/11

The U.N. Security Council approved the enforcement of a ‘No-Fly’ zone over Libya last night.  Wow, kind of like bringing the Beer after the picnic is over.  Two weeks ago it might have helped.  It may have encouraged the protesters and rebels who were fighting to take their country from the clutches of Qaddafi.  Now, it is just a gesture.

This is what the U.N. is good for.  They talked about the ‘problem’ in Libya.  Diplomats phoned each other.  Heads of State filled out their NCAA Basketball brackets on TV.  The French finally built up their nerve to act, after action would make no difference.

Qaddafi immediately notified the world that military operations had ended.  He declared a cease-fire!  Tripoli invited government and non-governmental organizations (NGO) to “check the facts on the ground by sending fact-finding missions (to Libya) so that they can take the right decision.”

Check-mate.

We didn’t understand John McCain and others calling for a no-fly zone when this all started.  What difference would it make?  Would our fighter jets fire on ground troops?  How were they going to take out anti-aircraft missiles?  What about ground based anti-aircraft guns?  Wouldn’t Qaddafi move them into populated areas?  Maybe even next to hospitals and schools.  These calls to do something…anything were just more confirmation that many of our ‘leaders’ are not leaders, but school ‘marms that want to order the world to their liking.

President Obama wisely ignored the calls for military intervention in Libya, but gave a nod to the French and British to lead the charge.  The British I trust.  The French don’t know how to win at anything.  They are too busy checking their navel hair to take decisive action.  The only war the French have ever won was the French Revolution.  Since they were on both sides, victory for one side or the other was inevitable.

News last night was that Secretary of State Hillary Clinton was tired of the vacillation of her president.  Perhaps I gave him too much credit for resisting the calls for action.  The U.S. should have been one of the countries abstaining from the vote at the U.N. last night.  Hillary says she will not serve in a second Obama administration.  A Clinton insider told the Daily, “Obviously, she’s not happy with dealing with a president who can’t decide if today is Tuesday or Wednesday, who can’t make his mind up.”

This was one of those cases where a decision delayed; no decision in effect…is to make a decision.  This time he was right not to make one, but for the wrong reasons.

Obama’s press conference this afternoon was full of forceful language.  The President demanded Qaddafi stop military operations and withdraw all troops from population centers or else face the consequences.  The next sentence was that the U.S. will not send ground troops.  Oh, ok.  Who is going to ‘light-up’ the ground targets for our smart laser guided missiles without ‘ground troops’?  I guess CIA doesn’t count.

The backside of this whole mess in Libya and the U.S. joining a coalition led by the French, is guess who sent troops to Bahrain?  Our ally, Saudi Arabia.  What is good for the goose is good for the gander.  Will the U.S. condemn Saudi Arabia for helping knock down the protesters and rebels in Bahrain?  It shouldn’t matter that they are backed by the government of Iran.  Why didn’t we go to the U.N. to call for a ‘no-fly’ zone over Iran last year?

Some may think these actions by governments don’t matter to us as investors.  Beg your pardon…look at the price of crude oil today.  As we go to press, the president finished his news conference and the market has dipped.  We think it likely to sell going into the close.  We like to be optimists, but are watching 1273 on the S&P 500  This is the 23.6% retracement of the market’s gains from August to February.

1273 is either resistance or support, look at it as the pivot point for the market.  Above it we go higher, below it we look at 1230.  The difficulty with the market is the headline risk.  Support and resistance take a back seat to the latest headlines from the world’s hotspots.

Editor’s Note:  Thanks to subscriber R.L. who sent a link from Google.  They have juxtaposed images of Japan before and after the tsunami.  They are revealing of the damage caused.  You can roll your mouse over the pictures and view the before and after.  Amazing…the power of Mother Nature!

The information presented in this newsletter is based on generally available news releases, corporate filings, current events, interviews and the editor’s opinions.  It may contain errors and you should not make investment decisions based solely on what you believe you have read here.  Do your own research, it is your money.  If you lose it, it is your responsibility, not ours or your grandmothers!  The editor may or may not have a position in any securities discussed.  The editor may have held a position in a security earlier, or in the future.

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