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Dominoes in the desert

Source: Financial Times, 21st March 2011

Western powers are in what Libya's Muammer Gaddafi promises will be a "long, drawn-out war", a development that seemed unlikely as late as Thursday of last week. Yet since then, global stocks are up, bond prices are down, and the trade-weighted dollar index has dropped to its lowest since December 2009. Oil prices are up, but below their recent highs. Why?



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