FREEFALL OF STOCKS POSSIBLE FOR NEXT WEEK AS WORLD READIES FOR WAR

Two major developments have occurred, one likely, the other possible, that will send shockwaves through the intertwined governments of our planet. The first is tomorrows critical Greek vote, the other is the rapidly escalating Syria/Iran conflict that is starting to look very bad for everyone involved. On top of this is the Egyptian vote which played out exactly as I predicted in an earlier post.

Let's look at the Egyptian election first. The two candidates that are now running are an Islamic Extremist and a Mubarak crony. Nice to see that elections even in new countries almost directly mirror our own where we also have a choice between a religious extremist group and a business as usual clown. As South Park put it, "we can choose between a douche and a turd sandwich." The average Egyptian is not happy with their choices, a fact many in this country can identify with.

This is from Reuters:

Reeling from a court order two days ago to dissolve a new parliament dominated by the Muslim Brotherhood, many question whether generals who pushed aside fellow officer Mubarak last year to appease the pro-democracy protests of the Arab Spring will honor a vow to relinquish power by July 1 to whoever wins.

"Both are useless but we must choose one of them unfortunately," said Hassan el-Shafie, 33, in Mansoura, north of Cairo, exasperated like many who picked centrists in last month's first round and now face a choice between two extremes.

With neither a parliament nor a new constitution in place to define the president's powers, the outcome from Saturday and Sunday's run-off will still leave 82 million Egyptians, foreign investors and allies in the United States and Europe unsure about what kind of state the most populous Arab nation will be.

Both contenders may herald further turbulence. An Islamist president will face a mistrustful army, while a victory by a Mubarak-era general will rile the revolutionaries on the street.

In this election, young people are pissed that none of the centrists made the final stage, that no matter who wins, nothing will change and whoever loses is going to riot in the streets. Who would have thought that we would have so much in common with the Egyptian people?

Then comes the Greek election. No side is ahead by more than one percentage point and could result in yet another election if this one fails to get enough votes for legitimacy. Greeks are pulling billions form banks and anti-austerity fever is high regardless of what BBC says in a highly questionable (and illegal according to Greek law) poll that said more people are willing to accept slavery in return for security, a fact not born out by the rioting in the streets and public opinion. Austerity has never worked in the past and won't work here. The second round of the Great Depression was brought on when FDR unwisely raised taxes and cut spending (as the Republicans of the time were screaming for him to do) which killed the economy and plunged us back into hell. This is the exact formula Europe is doing as well. Good luck with that.

Then comes Syria. With Russia sending attack helicopters and possibly Spetnaz troops to Syria, the Western World appears to have had enough. Plans are supposedly being written as I write this for an attack plan by the Pentagon. With Russia not complying with UN rules, NATO will almost certainly follow suit, much like the attack on Kosovo, which was not approved by the UN because the Russians kept vetoing any action while supplying weapons at the same time to the opposition.

A no fly zone is being discussed as well as an embargo, much like the one also being discussed against Iran. The current expectation of an attack now are not if but when. Arming the rebels, a dicey proposition as God know who or what they are composed of, is also in the works. This is the kind of thing that could go horribly wrong, or right if you are a weapons manufacturer or arms dealer. This week, especially Monday will be one to watch.

For all you who bought stock on Friday, and there were some I'm sure who weren't using high speed computers to do it, I have one word for you: Sucker. Talk about buying at the highest possible point. The stock market is all but guaranteed to drop, perhaps significantly, on Monday. Don't say you weren't warned.