CIA May Win 2nd Golden Bull Award!

Charts: The S&P 500 closed at1102, up .6%. By pushing past the 1100 resistance level the broad index looks better technically.

Fundamentals: The dollar continues to rise as the carry trade falls apart. This is causing short term pain but in the long run it is good news because once the dust settles we will be able to once again engage in traditional fundamental analysis and invest long term without our fingers constantly hovering over the sell button because we can’t figure out what crazed hedge fund managers are doing with the #@%& carry trade. When and if it is over we can all say good riddance.
Obama-Care is running into strong opposition. Howard Dean is denouncing it. Labor unions are denouncing it. And Senator Nelson of Nebraska (the last Blue Dog with an intact set of cojones) is digging in his heels. If it doesn’t get passed before Christmas the thing faces a rocky future.

Geopolitics: A squad of 11 Iranian soldiers crossed into Iraq and seized part of an oil field, raising the Iranian flag over an oil well. On the surface this seems to be an act of war between Iran and Iraq but probably these soldiers have gone rogue or Iran is posturing due to its deteriorating grip on power at home.
The CIA sent 7 of its advanced Reaper drones into N. Waziristan, Pakistan, home of Al-Qaeda, and in the biggest drone strike ever killed over a dozen top Al-Qaeda and Taliban leaders. Rumors are flying that Osama bin Laden’s brother-in-law was killed. The DMU awards committee is debating still another Golden Bull for the CIA over this incident.
In an impressive show of force, the Yemeni Army and Air Force attacked several Al-Qaeda in the Arabian Peninsula positions in southern Yemen, killing 34 bad guys and 17 bad women and bad children. As horrible as it sounds, the lack of media coverage in the Yemen war allows Saudi Arabia and Yemen to bomb refugee camps that contain combatants and non-combatants alike. The Yemen Army calls their offensive “The Scorched Earth Campaign” an example of truth in advertising. Yes, it is horrible, but allowing Al-Qaeda to build a nation state on the Arabian Peninsula is more horrible. The Yemen Army strike has the CIA’s fingerprints on it and is one of the reasons why a second Golden Bull award is being debated.