Syria Brings Volatility To The Market As Investors Brace For Fed Tapering, Debt Ceiling

rtAfter last Friday’s weaker than expected jobs report with no other major economic reports on tap before the Federal Reserve’s next Fed meeting on September 17-18th, investors will weigh the likelihood of a potential stimulus taper in September alongside some recent volatility over a potential U.S. led military strike in Syria and the need for increasing the U.S. debt ceiling in mid-October.

Equities faced selling pressure last Friday after Russian Prime Minister Vladimir Putin announced that Russia would support Syria in the event of a future air strike.

Putin said that that Russia has “plans” on how Russia would react if such a scenario occurs.

“We are already helping them with weapons and we are cooperating in the economic and humanitarian spheres,” Putin said.

U.S. President Barack Obama faces a challenging political climate to receive enough Congressional votes and American public opinion support to authorize American air attacks against the Syrian government which stands accused of carrying out the August 21st chemical weapons attacks that killed over 1,400 Syrians, including hundred of innocent children.

According to a recent poll from the Pew Research Center, only 29 percent of Americans support U.S. airstrikes against Syria, 48 percent oppose an air attack, and 23 percent said that they don’t know (undecided).

Obama has insisted that an attack on Syria won’t be intended to make a regime change with Syrian President al-Assad  and will be “limited” with no targets being aimed at Syrian sites that hold chemical weapons.

Obama’s blueprint for a punishing air strike in Syria is now fully broadcasted to the world and is aimed at enforcing international laws arising from the 1925 Geneva Protocol that prohibits chemical weapons from being deployed.

Many Americans are war weary after witnessing the U.S. military being deployed in war across the Middle East and Southeast Asia over the past decade with trillion dollar war costs weighing down the U.S. debt load at a critical time when the debt ceiling will have to be raised again next month and the costly military invasion of Iraq based on the mistaken notion of Sadaam Hussein possessing weapons of mass destruction are still fresh in the minds of Americans.

As Congress plans to convene this week in Washington D.C. after a long break, President Obama will outline his case for a Syrian military airstrike to the American public on Tuesday night in a State of the Union speech.

The U.S. Senate will vote on Wednesday to authorize U.S. force in Syria.

White House Chief of Staff Denis McDonough made several news interviews over the week-end and articulated the need for supporting a U.S. military response against Syria.

During Fox News Sunday, McDonough said that the no one he has talked to doubts or questions the reliability of U.S. intelligence that places the blame for the chemical weapons attack with the Syrian government and “the risks of inaction outweigh the risks of action.”

“So the question now is, for Congress to resolve this week is, are there consequences for a dictator who would have used those weapons to gas to death hundreds of children? McDonough asked.

Over the week-end, Syrian President al-Assad rejected the claims that associate his government to the August 21st chemical weapons attack on Syrians.

During a recent interview with CBS’ Charlie Rose, al-Assad said that there has been no evidence linking him to the chemical attacks.

Assad later blamed government opposition groups (rebels) for carrying out the chemical weapons attacks.

“There has been no evidence that I used chemical weapons against my own people” he told CBS’s Charlie Rose. The interview will air on Monday.

U.S. National Security Deputy Spokesperson Bernadette Meehan responded to al-Assad’s denial for the chemical weapons attacks in Syria.

“It doesn’t surprise us that someone who would kill hundreds of children with poison gas, would also lie about it” Meehan said.

The Obama administration has made it clear that the Syrian government is responsible for carrying out the August 21st chemical weapons attacks and government opposition groups pitted against the Syrian government are not capable of carrying out the type of heavy chemical weapons attacks that occurred in suburbs outside of Damascus in areas known to support government opposition sentiment.

During the close of last week’s G20 meeting in St. Petersburg Russia, President Obama received a joint statement from several countries calling for a strong international response to the chemical weapons attacks in Syria.

The countries included in the joint statement are Australia, Canada, France, Great Britain, Italy, Japan, South Korea, Saudi Arabia, Spain, and Turkey.

 

 

 

 

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