Reuters: Investors are selling defense stocks for fear a Democratic victory

[sabra]

http://www.alertnet.org/thenews/newsdesk/N03330627.htm

Arms stocks dip, but seen immune to U.S. elections

NEW YORK, Nov 3 (Reuters) - Investors are selling defense stocks for fear a Democratic victory in next week's congressional elections could mean cuts in military spending, but experts say Pentagon outlays will keep up their spectacular growth for at least two years, no matter which party wins.

In the run-up to Tuesday's Congressional elections -- in which Democrats must pick up 15 House seats and six Senate seats to reclaim control of Congress from Republicans -- Pentagon suppliers' shares have taken a small beating.

In the last two weeks, the Standard & Poor's Aerospace and Defense index <.GSPAERO> has dipped nearly 4 percent from its all-time high, while the S&P 500 is close to unchanged.

...

"I do not expect (defense spending) to change in the short run in any event," said Michael Strianese, the new chief executive of Pentagon contractor L-3 Communications Holdings Inc. <LLL.N>, which makes aviation electronics gear and operates intelligence networks.

...

"I don't see where the occasion is to pull that in (reduce spending) in the short run, and probably even going into 2008," said Strianese. "If the Democrats do pick up one of the Houses and they were to put pressure on the budgets, it would give them a headwind in the presidential election for being weak on national security and defense."

[HereSince1628]

1. But they're buying oil today.

Reuters is just full of shit IMHO.

The nation still has to replace the stuff it loses and wears out. That ain't gonna stop in the next two years. The Dems are going to make sure that the military is rebuilt from it's current broken state. And we might as well be honest. If the Dems redeploy, they'll downsize the force and leave the mostly worn out equipment behind. All that must be replaced.

[Bucky]

2. Damn those budget-balancing liberals and their frugal small government ways!