It's a new world of deflated stocks, oil, and even gold - at least based on global market trading of the past month and a half.  Leveraged players are being wiped out with margin calls and the indexes are at multi year lows.  But when I go to conservative news sites like drudgereport.com, the title story is not about the Wall Street massacre.  It's about Iran.

Yes, George W. Bush is still in office.  And yes, he still wants to do something about Iran.  Is he a stubborn man?  Of course.

Vice President Dick Cheney and the crew of defeated neo-conservatives are looking at one of the most disasterous legacies of any American political generation.  They are also looking at the end of conservative politics in America for quite possibly a very long time.  They have exactly two months left and what are they paying attention to that investors should maybe pay attention to?

Iran.

Sixty days is a long time.  Sixty days ago the Dow Jones Industrial Average was around 11,500, Obama and McCain were in a tight race and there were worries of a slow down.  Today it closed at 7,500, Obama won in a landslide, and there are worries of a depression.

Bush doesn't need to attack Iran.  All he needs to do is give his approval to Israel.  The International Atomic Energy Agency has said that Iran is now capable of building one nuclear bomb.  Israel has made it perfectly clear that they intend to not allow Iran any chance of having a nuclear weapon.

Barack Obama, meanwhile, has already started to put together a pro-Israel cabinet.  That might give Israeli leaders an excuse to wait and hope for Obama's promised diplomacy.  But with a strong intent to eliminate Iran's nuclear capabilities, Israel risks allowing president-elect Obama to take a leadership position that is not in their interest - at least in their minds.  Moreover, history has shown that when the president signals for war (as a response to aggression, for example), the opposition party often reluctantly supports the decision.

My advise is to watch out for 'increased tentions' in the Middle East and start looking at the falling oil stocks.  Call it Bush's last stand.  Look for the Bush and Israel to somehow provoke Iran in looking for a fight.  Oil is suddenly so low that the risk to it going higher than where it was six months ago have dramatically diminished.  War and the threat of war would also help defense stocks and divert attention away from the stock market chaos.

The governments have run out of ways to help the world economy.  They are finding the 'enemy' to be their own failed policies.  Look for them to focus back on a scapegoat enemy.