August 22, 2021
Dennis Elam is an associate professor at Texas A&M San Antonio and a 1966 graduate of Andrews High School and blogs at https://professorelam.typepad.com/markets/
Bringing the troops home does not end the war with terrorists. It just moves it to a location and time of their choosing.
Letter to the Editor Wall St Journal
The United States has at least 2,500 troops in eight different countries around the world. The hasty withdrawal from Afghanistan has left Americans and US Afghan operatives stranded. Worse, it strengthens Taliban influence on nuclear-armed Pakistan. Putin has already denied the US use of Central Asia for survey activity. Worse Afghanistan will now be a safe harbor for terrorists around the world. The original idea was not to turn Afghanistan into Belgium, but to deny terrorists a safe haven to plan world-wide mischief. And now Team Biden also abandoned the Bagram Air Base, an improvement the Taliban would likely never have constructed on their own. And then there are the billions of dollars of Humvees, helicopters, airplanes and MP-4s the Taliban are now brandishing for TV crews.
So let’s connect the dots. Team Biden rejected all things tinged with oil and gas as noted in this space last week. Now the Team, unable to rely on domestic oil and gas, is begging OPEC to increase production. But wait; team Biden claims oil producers pollute. And this is the war on Climate Change. How does relying on a barrel of OPEC oil rather than Permian Basin oil, fight climate change? Worse this makes Iran’s oil more valuable in that Biden’s EPA will soon descend on US producers with massive new regulations.
After decades of recovery from the Saigon exit disaster, now America is seen as an unreliable ally. Already the President of Taiwan has stated “our only option is to become stronger and more united.” Team Biden failed to get the withdrawal in the correct order. Remove Americans and Afghan translators, destroy or remove weapons of war, then bring home troops. The temptation to take hostages for ransom will surely occur to someone in the new regime. And the usual adversaries, china, Russia, North Korea will certainly use this calamity to test the resolve of Team Biden in the near future. India has long feuded with Pakistan. Danger in Pakistan and an emboldened China are not good news for India.
Our suggestion that oil prices are headed to the mid 50s appears to be correct This Friday WTIC prices dropped to the $63 level. That turns the daily trend down.
We also expected stock prices to fall into the seasonal lows of September-October. The NASD 100 has likely completed its first leg down from 15,175 to 14,775. Expect a rebound and then a lower low probably near 14,000.