Back in February this year, Israel gave a six month deadline for Iran to acquire the necessary "knowledge" to make nuclear weapons and Israel also stated this would be unacceptable.

Israel has purchased the necessary long range bombers and "bunker buster" bombs required for what I understand would be a three-day bombing mission according to some military experts.

That would point to the end of September for such a possible bombing raid on Iran's nuclear facility.

Should that (or another terrorist attack on the scale of 9/11) occur, what do you think the short term and medium term impact would be on the SP500, Larry?

Thank you for any suggestions or opinion.

I am not interested in any political issues - only any views with regard to such a news event's impact on investing and the market.

If this question is a problem in any way please do not hesitate to remove it.

the market would tank & oil would spike.

my humble opinion.



-ja

Clint,

Would you provide a link (or two) that provides more details and history of this matter? Thanks.

Clint,

Which one? An Israel bombing attack on Iran or a terrorist attack on the scale of 9/11? There’s a huge difference between the two.

Larry

I suppose I would focus on a bombing of Iran since that seems to have a possible deadline from Israel whereas a large terrorist attack is far less predictable.

I somehow suspect that there are deeper interests in preventing Iran from attaining nuclear capabilities and I was a little surprised that Scott Ritter's June deadline proved incorrect.

So since Israel has been acquiring the means (bombs and bombers), gave a deadline last February, and had done the same thing to Iraq some years ago, it seems likely to me that something should happen (though it may not) before October 1st.

Frankly, Larry, I hadn't considered that the market would react differently to an attack on Iran than to another 9/11 terrorist attack. I had assumed that the market simply doesn't like uncertainty and would probably go down in either case.

If you have a different idea that would be fascinating to know. I can tell you with certainty that I know I do not know!

On Israel's deadline from February 16th, Reuters:

http://www.infowars.com/articles/world/iran_will_have_nuke_tech_in_6_mo_says_israel.htm

On April 13, CNN reported on Sharon regarding a "point of no return":

http://www.cnn.com/2005/WORLD/meast/04/13/sharon.mideast/

The same day another message was sent:

http://www.heraldsun.news.com.au/common/story_page/0,5478,15272954%255E1702,00.html

Here is some information regarding Israel's build up:

http://www.worldthreats.com/middle_east/Another%20Osirak.htm

Clint,

All we have to go by is history. After 9/11, the market shut down for a week and when it opened it sold off dramatically. I posted at the time that it was time to cover shorts and buy some Dow Jones type blue chips. It found a bottom within a few days and rallied for the rest of the year. But it made new lows in 2002 as the real economic impact of an attack of that magnitude on U.S. soil became evident.

I’m not sure what would happen if Israel bombed Iran. If it was successful, I would imagine the market would view it favorably. It was not successful, that would be another story.

Larry

It wasn't the answer I expected but then that's why I asked - to get the opinion of someone whose expertise I respect!

Thank you!

I'd like to throw in my own complicating 2 cents (27 if you add in inflation). If such an attack were accepted by the Arab world who would then slap the west on the wrist with small terror incidents and talk of cutting off oil I think the market would do well. But the uncertainty of what the Arab world would do would I think lead to an acute downturn. Of course if the Arab world did not accept such an attack and it developed into a full scale Arab-Israeli war, I think the downturn would be longer. Most Americans think that because of the 1967 war any middle east war would be short. We forget how long the 1973 war lasted and we forget that the sides are much more equal now than they were. It is possible that such a war today could be more like 1948 and last months than 1967 and last days.
If you want to factor in Israeli politics consider that Sharon has also set a deadline for withdrawal from Gaza and is facing stiff resistance from settlers. It may make an external attack more likely as a way to quell dissent within the country.
Just my opinion, if I stepped on toes, I apologize.
h