War removes uncertainty from investors’ minds

Published 12:00 am Saturday, March 22, 2003

NATCHEZ &045; Amid the unfortunate reality of war, there is a bright spot here at home: the U.S. economy is so far responding well.

That is to say, according to Natchez investment adviser Mike Henry, the stock market continues to rise and oil prices continue to drop.

Henry said he is &uot;very optimistic&uot; about the chances the economy will continue to improve.

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&uot;It appears the uncertainty leading up to the war had a dampening effect on the market and the economy,&uot; Henry said.

But since the war began, the Dow Jones Industrial average has risen some 900 points &045; 235 points just on Friday.

&uot;It appears this is going to be a short-lived war,&uot; Henry said. &uot;Barring any unforeseen difficulties, this market is going to continue to respond favorably.&uot;

The uncertainty of the past few months as the U.S. moved toward war with Iraq may have hurt what could have been an improving market, Henry said.

&uot;Everything that’s normally in place for a good market is there &045; almost zero inflation, high worker productivity, very low levels of inventory,&uot; he said. &uot;Businesses that have held off from purchases are going to be buying. The economy is going to come back.&uot;

Oil prices have dropped 30 percent in the past week, Henry noted, which was the same reaction after fighting began in the 1991 Gulf War.

&uot;It’s clear the flow of oil is not going to be affected,&uot; he said.

Still, despite the optimism about the economy, most of Henry’s clients really aren’t focusing on their money right now.

&uot;My clients in the last week have been more concerned about what’s going on in Iraq than their accounts,&uot; he said. &uot;It’s got their attention.&uot;