Obama Delay Hurts War Effort

Charts: The S&P 500 closed at 1063, down .3% on the day and 1.5% since Monday. Leadership is weak. Volume patterns are bearish.

Fundamentals: South Korea reported Q3 GDP and surprised to the upside, a pocket of strength to otherwise downbeat global data. American consumer confidence numbers today and over the past couple weeks have been coming in very weak, due to fears over rising unemployment. In China, internet advertising revenue is weakening. Weak data out of the US and China could be attributed to the so-called “air pocket” that the Economist talked about.

Geopolitics: The Pak Army body count is more reasonable this week and therefore probably accurate with 29 bad guys killed and 6 good guys killed on Monday. The fighting is of course mostly in S. Waziristan but other tribal regions continue to see clashes. In S. Waziristan, the Army is slowly grinding forward on all three of its prongs, methodically clearing forests and mountaintops around small Taliban towns that it needs to conquer and hold before it can advance on key cities like Makeen (capital city for the Pakistani Taliban). The Army says that it captured two more small towns on Monday.
In Afghanistan, 8 US troops were killed in a coordinated Taliban multiple bombing attack. 14 troops were killed earlier in the week in non-combat helicopter accidents. US combat and non-combat deaths in Afghanistan are more damaging to American public opinion now then under normal circumstances because the President is locked into his delaying tactic over McChrystal’s policy review.