PrintMarch 7, 2007
Iraq Stock Exchange Index
The Iraq Stock Exchange maintains a comprehensive index, the Iraq Stock Exchange Index (the ISX). Stock prices are dicey things, as we have seen on many world markets in the last week. Still, the ISX is one measure of confidence in the Iraqi economy, and given that we know the MSM is essentially rooting for the opposition in the Iraq War, it behooves us as citizens to be as comprehensive as we can be in assembling our own mosaic of what is going on in Iraq.
There is little doubt that we have made enormous mistakes there, but history shows that war is frequently a contest of wills as much as of capabilities and it shows numerous examples of nations that have made huge mistakes - far worse than ours - and still prevailed due to superior will. One thinks of the Russia in World War II as an example.
Are we winning or losing in Iraq? It is hard to tell. There are so many aspects to the war, not just geographically, but also socially and economically. But the ISX can tell us something about the economy.
The ISX was at 43 in January 2006. Between January and April 2006, it slid from 43 to 25, a big decline. Between April and December 2006, it essentially went sideways, fluctuating between 25 and 30.
Since early December, there has been a modest advance, from 25 in early December to 26 1/2 on March 5 (scroll to bottom). I said it was a modest advance! About 5%. So why is it significant? Well, it may not be, but it does cover the peirod of our new surge strategy and of the appointment of General Petraeus to lead our effort. There has been much naysaying in Washington about the pointlessness, indeed the cluelessness, of the surge strategy. But we are not seeing such a negative reaction in Iraq. If the surge strategy were seen there as a prelude to defeat and withdrawal, then it is highly unlikely that the ISX would have gone up during the last three months, even given the modest magnitude of the advance (keep in mind that the ISX is still down year-to-year; it is up over the last three months).
I have already mentioned previously the remarkable 15% surge we have seen in the value of the Iraqi dinar over the last three months, which continues through yesterday (March 5, 2007). This also appears to suggest confidence in both economic activity and in the future of the country.
So the news - the actual facts - are not all bad. The point of knowing this is so that we as citizens remain informed as to the actual state of affairs in Iraq and don't panic based on true, but partial, negative news from the front.
