Iraq, Paper, Scissors

The most pertinent market information at the moment probably isn't subject to the SEC's fair-disclosure rules. Instead, it might have to be pried by foul means from the mind that choreographed Sept. 11. Khalid Shaikh Mohammed may know details about the next big terrorist attack.

So why did the market celebrate his capture by ducking Monday? Because it turns out that the Orange Alarm instigated by his plans depressed consumer spending last month.

It's earnings warning season, and hardly anyone cares. The only warning worth heeding came Saturday from President Bush, who didn't say in his weekly radio address that Saddam Hussein has one last chance to disarm. Instead, he told the nation that "we will remain in Iraq as long as necessary, and not a day more." That clock is ticking, since U.S. special forces reportedly have already sneaked in. In case you missed it, the liberation of Iraqi oil reserves has pretty much begun.

That means it's decision time for investors. They've tried to peer through the fog of a coming war for a month now, with most concluding that the math is just too hard. The Dow dares not get above 8,000, on the chance that the onset of hostilities brings burning oil wells and terror strikes. But it dares not fall to 7,000 on hopes that a quick victory might bring back jobs and $1.10 unleaded.

There's probably just one more week left to choose sides. With or without a northern front, the U.S. remains wedded to the logic that the time for inspections is past, or will be after one more Hans Blix report late this week. The next time Blix visits Baghdad, Tommy Franks might pick him up at the airport.

According to the Washington Post, artilleryman Franks plans to mount a lightning-quick (at least by an artilleryman's sights) thrust deep into Iraq any week now. The aim would be to dismantle Saddam Hussein's leadership within days of the first bomb dropping, denying the regime an opportunity to use some of the weapons it claims not to possess.

So if the averages don't hit fresh lows this week, that lesser day of reckoning might be postponed until sometime after the victory parade, if not avoided altogether. I've gone back and forth on the wisdom of owning stocks in recent weeks, but if the market would just tank conclusively by Friday, it might get another crack at my retirement stash.

Wall Street has been nothing short of schizophrenic on the subject of Iraq, deploring the economic damage inflicted by the buildup to a war, then staging an occasional short-covering rally whenever war seems like it might be delayed, extending the entire sorry mess.

Most traders could probably agree with BET founder Robert Johnson, who told Wolf Blitzer Sunday that "whatever is going to happen, it should happen quickly." But then who knows how cheap U.S. stocks might be now if their pacifist European owners were calling their brokers instead of marching.

In a thinly traded market, every conceivable constituency has had its 15 minutes of fun. Predicting how all of them might react to the start of combat seems as risky as manning an Iraqi antiaircraft battery. Lots of respected analysts are dubious about the common wisdom that stocks will soar with the first explosion in a repeat of the first Gulf War. They're dubious because going against conventional wisdom has been the only way to go for years now. Even so, there's probably enough hot money on the back burner to make quite a splash for a day or two.

Fact is, everyone's money is plenty hot on the cusp of an event horizon. The battlefield blitz cooked up at the Pentagon implies that within two weeks, three weeks tops, stocks will be worth considerably more or considerably less than they are now, but probably not something in between.

Iraqi oil fields either will or will not be on fire as U.S. troops try to occupy them virtually from day one. USA Today's handy chronology of the first Gulf War reminds readers that Iraq had blown up select Kuwaiti oil wells and the main oil terminal by Day 7 of Desert Storm. Saddam Hussein was even less shy with his Scuds the last time out, firing them at Israel and Saudi Arabia within hours of the first coalition air raid. He's either squirreled a few away or not, and it won't take long to find out.

This is not to minimize the dangers of urban combat in and around Baghdad, the horrors of collateral damage or the task of nation building in the heart of the Middle East. The market will have lots of opportunities to change its mind, but will still have to make a momentous snap judgment in a space of hours and days, not weeks and months, because the war plan is apparently predicated on moving quickly to head off everyone's worst-case scenarios.

So I have no idea how or why the Chicago Board of Exchange Volatility Index made it all the way down to 34 by Monday, because the market seems poised for a bout of volatility impressive even by its own demanding standards.

Some enterprising cable news network ought to ban the stock ticker for the duration of the Iraq conflict, and then loudly promote this service. Because no one, and least of all the many investors currently sitting on their hands, wants or needs this much excitement.