Column #477      October 18, 2024Goldman Sachs Bull/Bear Indicator

As we all recognize, Israel is surrounded by Iran’s militant/terrorists proxies. “Tehran's 'Axis of Resistance' includes Hezbollah, Hamas and the Houthis as well as groups in Iraq, Syria and Bahrain.”1

The Iran-funded proxies represent a formidable threat to Israel’s survival as a nation. For decades the goal of the proxies has been to destroy Israel. They have been generously funded by Iran—not for peace and the betterment of their citizens, but to destroy Israel. For instance, instead of turning Gaza into a tourist destination, they turned it into a huge defensive/offensive weaponized bunker with a civilian population as cover!

Since October 7, 2023, Israel has been under a daily siege and is fighting on several fronts. Since the civilian death toll in Gaza doesn’t differentiate between combatants and civilians, the anti-Semitic population of the world is acting aghast as Israel battles its enemies. And now that Hamas has been virtually wiped out, Gaza is a major humanitarian disaster that has the U.S. demanding Israel must supply it with aid if Israel wants military support from the U.S.

With the election looming in the U.S., it’s really difficult to say what the goals are for Biden and Harris. Does Biden want to make Harris look worse than she is—if that’s possible? Is there an October surprise coming up? Who knows with this wacky administration? Is the recent B2 stealth-bomber bunker-busting bombing of Iran-backed Houthi targets in Yemen a sign of more support? Or was it a long-delayed response to Yemen targeting shipping in the Red Sea around Yemen? Here is what we do know.2

An initial U.S. developed THAAD missile system is in Israel and is now fully operational, complete with about 100 U.S. service members manning it. When that was announced, the Washington Post also said that Israeli Prime Minister Benjamin Netanyahu would not strike Iran's nuclear or oil sites. Oil dropped $7 a barrel in an instant.

A day later, Netanyahu denied the report that President Biden has used diplomatic finesse to ensure Israel won't strike Iran's nuclear or oil sites. "We listen to the opinions of the United States, but we will make our final decisions based on our national interests," Netanyahu’s office said October 15, as cited in Bloomberg. So we are back to wondering what does Israel plan to do—before or after election day?

The scuttlebutt is that Israel’s retaliation to Iran’s October 1 ballistic missile barrage of around 180 rockets will be within the next two weeks before the election. Israeli Defense Minister Yoav Gallant has said that Israel “will soon respond” and it will be “precise and deadly.”

Because Netanyahu has been looking for a reason to take out Iran’s nuclear facilities for years, I doubt that he will pass up this chance even though the U.S. believes that if energy or nuclear sites are struck, Iran will retaliate by attacking oil facilities in nearby gulf states, sending the price of crude soaring. But who knows?

What is known is that the tit-for-tat war is going to escalate. If Israel comes to a peace agreement with its enemies while they still have the will to fight, they will rebuild and in time attack Israel again with ever greater weaponry which will probably include nuclear weapons. Iran and its proxies have one primary goal they live for. That’s to eliminate Israel from the face of the Earth. Therefore, Israel is in a fight to the death. Its main military backer is the U.S. and the strategy of the Biden/Harris administration is appeasement. So it’s a dicey game.

Whatever the Iranian target is in the next two weeks, if it’s not dramatic, Iran will take that for weakness. In that case Israel gains nothing in its battle with Iran’s proxies. But in the past week or so, the Middle East has witnessed a significant transformation when Turkish President Erdoğan called for a Russia, Iran, Turkey, Syria alliance against Israel. That puts a lot of pressure on Israel’s response. It doesn’t seem nutty to see where some really heavy hitters may get involved. So the region is a powder keg that could blow sky-high.3

What’s interesting is that our stock market is floating ever higher supported by one of the most extensive government spending binges in history. Valuations have rarely if ever been as extremely overvalued as they are now.

This column’s image is the Goldman Sachs Bull/Bear Indicator as presented by Elliott Wave’s Steven Hochberg. His comment is that “the Goldman Sachs Bull/Bear Indicator, a combination of stock valuations, the yield curve, manufacturing activity, inflation, private sector spending and unemployment, is at levels that have attended the start of major stock market declines over the past 50 years. Investors have essentially zero concerns or fears that stocks will decline in any substantial amount for any significant period of time. The vulnerability for just such a selloff is extremely high.”

Obviously, whatever Israel does will have an impact on the United States at a very vulnerable time. I’ve been warning about a massive stock selloff for many months now. As seen on the monthly Bull/Bear Indicator chart the peaks may be only one month, but the period of overvaluation may be many months. Yet, when the correction starts it’s usually a wipe out that takes only a few months.

Events are closing in on us. The next few weeks will be quite interesting.

To your health.

Ted Slanker

Ted Slanker has been reporting on the fundamentals of nutritional research in publications, television and radio appearances, and at conferences since 1999. He condenses complex studies into the basics required for health and well-being. His eBook, The Real Diet of Man, is available online.

For additional reading:

1. Who are Iran's proxies in the Middle East?

2. B-2 Bombers Strike Iran-Backed Houthi Targets in Yemen by Nicholas Slayton from Task & Purpose

3. Axis of Ezekiel 38? — Turkish Pres. Erdoğan Calls for Russia, Iran, Turkey, Syria Alliance Against Israel by All Israel News