CIA Drinks Special Forces Milkshake

Charts: In the last blog I said that if the S&P 500 dropped to 1500, found support, and bounced up, then the technical damage done by the Doji Candlestick formations may be over. The broad index did exactly that, dropping 2% from its recent high and bouncing off 1500. What we need to see is healthy consolidation, not stalling action while the index flatlines, that's what Doji formations are: a form of stalling. We want to see the index move sideways in a rhythmic or trendline or wavelike fashion, not throw up scary candlesticks.

Fundamentals: Corporate profits as a % of GDP are at an all-time high. The value of the stock market as a % of GDP is near an all-time high. This is the main problem we are facing now. Corporate America has become super lean and efficient. It is churning out profits even though GDP is barley growing. This can't last forever. Corporations can only get so efficient. At some point GDP has to grow. the best way for this to happen is a free trade accord between America and the EU. Obama is working on that. He generally sucks at economic issues but he is right on this one.

Long War: 100 US Intelligence troops have landed in a border region near war-torn Mali to secure the area needed to build a US drone base. The Obama Administration calls them intelligence support troops. I think that means CIA paramilitary troops. I think that means the drone base will be CIA. I think Special Forces are not drinking the CIA's milkshake. This is really good news. (if I'm right)

Besides the repeated use of the word "intelligence" in the Executive branch dispatch I am making these above assumptions because there seems to be no more road blocks to the installation of Brennan as CIA Director. In the recent past, when Brennan seems to be moving forward, then the CIA has started kicking ass. When Brennan's nomination bogs down, then the CIA flounders, fearful of some lame director taking over which makes individual operatives want to cover their bungholes and act conservatively.

French and Malian troops have been bogged down in a savage firefight in the Malian town of Gao for several days. Yesterday they seem to have blasted the bad guys out of Gao and are hunting them down in the countryside. So the conventional phase of this war is still going forward in a positive manner.

Now the multi-year guerrilla phase is ready to start. The 7000 strong all-African Army that will fight the guerrilla war under French and CIA leadership is in place and nearly ready to go. It needs to establish road checkpoints across the jihadist threatened territory of the Northern Mali. These checkpoints need to be backed up with CIA drones. Then the lengthy guerrilla campaign will go smoothly.

If all this happens, and is deemed a success, then we will have a template for future LW wars (or campaigns). Native troops establish checkpoints, controlling the ground game, and CIA drones back them up with robotic air support.