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Thursday, June 11, 2009

Another reason for the markets to make another spike the IRAN elections

Against the well respected but usually bad informed (or rather placing wrong information deliberately ) economist article about the IRAN elections - the article below gives Mousavi a good chance to win the elections. The probability is high for a final vote in next weeks 2 candidate final as now one should reach the 50% hurdle in round 1 tomorrow. within the overall euphoria and obvious upside manipulation of markets it is a good timing as the end of Q2 window dressing will be a save bet for the upside in the final week of June.

Excerpt

Ahmadinejad Challenged in Iran Vote as Rivals Decry Isolation

June 11 (Bloomberg) -- Iranian President Mahmoud Ahmadinejad faces a serious challenge in tomorrow’s election as two rivals favoring better relations with the West and a former Revolutionary Guards commander try to deny him a second term.

Ahmadinejad is beset from one side by former Prime Minister Mir Hossein Mousavi and former parliamentary Speaker Mehdi Karrubi, who both favor easing tensions with the U.S. and Europe and allowing more social and political freedoms. Former Revolutionary Guards commander Mohsen Rezai, 54, appeals to many of the same voters Ahmadinejad is courting.

The president’s opponents seek to deny him the 50 percent of the vote needed to seal his re-election in tomorrow’s first round. If they do, he would be forced into a potentially perilous second round next week against the candidate with the next highest vote total.

“If this election is held fairly and no unexpected developments occur, Mousavi stands every chance of winning in either the first round or a runoff contest,” said Ali M. Pedram, an Iran expert at Durham University in the U.K.

Karrubi and Mousavi accuse Ahmadinejad of isolating the country and squandering years of rising crude oil prices through mismanagement that has fueled an inflation rate of 23.6 percent and unemployment of 10.5 percent. With oil now down to $71 a barrel from a July record of $147, Iran faces widening budget deficits, the International Monetary Fund says.

City Poll

Mousavi narrowly led Ahmadinejad in an opinion poll conducted only in 10 major cities, state-run Press TV reported on May 26. Mousavi had about 38 percent against Ahmadinejad’s 34 percent. No margin of error was given and respondents weren’t asked about Karrubi.

The presence of both Mousavi and Karrubi on the ballot is the best chance to hold Ahmadinejad below 50 percent in the first-round vote, because they will attract different regional and social constituencies, said Karrubi adviser Mohammad Ali Abtahi. They would then unite behind whoever got into the second round.

“It was all we could do to lead the election toward a runoff,” said Abtahi, a vice president under former President Mohammad Khatami.

Abtahi added that the opposition was running “a big risk” by not uniting behind a single candidate. The two-candidate tactic could backfire and allow the president to win in the first round, boosted by the support of lower-income voters, said Kaveh-Cyrus Sanandaji, an Iran expert at the U.K.’s Oxford University.

Nuclear Questions

Still, the president is being pressured over economic and foreign policy, said Karim Sadjadpour of the Washington-based Carnegie Endowment for International Peace. Mousavi, 67, has drawn tens of thousands of people to his rallies. Millions have watched televised debates involving the four candidates.

The president says his government has bolstered the nation’s standing internationally and helped the poor at home.

“This government has worked hard and achieved 10 times as much as previous ones,” Ahmadinejad told cheering supporters in a May 22 rally in southern Tehran.

In 2005, Ahmadinejad, 52, clinched a surprise second-round victory against multiple candidates, some of whom supported Khatami’s policies aimed at moderating Islamic rule. All three of his opponents this year say the president’s confrontational stance on Iran’s nuclear program, which he says is not aimed at producing a bomb, has isolated the country.

Iraq War

Mousavi is considered Ahmadinejad’s strongest challenger, in part because of Khatami’s endorsement, Sadjadpour said. Mousavi kept the economy stable during the 1980-1988 war with Iraq, he added.

Khatami won landslide victories in 1997 and 2001 with turnouts that reached a record 80 percent the first time and 67 percent the second. Ahmadinejad, who has focused on buttressing support in the more rural, religiously inclined provinces, won on a turnout of less than 60 percent four years ago.

“What we have now is very similar to 1997, when young people took part extensively,” said Majid Farahani, Mousavi’s Tehran province campaign manager. “The youth have realized that if they do not take part, a minority will decide the future.”

Khatami, who quit the contest to avoid taking votes from Mousavi, endorsed him at a May 23 Tehran rally. He appeared alongside Zahra Rahnavard, the first candidate’s wife to participate in her husband’s campaign. Thousands draped in Mousavi’s green campaign color chanted: “There’s no freedom of thought without Mousavi.”

Young Voters

Mousavi and Karrubi, 71, who took third place in the 2005 first-round election, are working to enlist young voters.

Iran has one of the world’s youngest populations, with as many as 70 percent under the age of 30, born after the 1979 Islamic Revolution. Two-thirds of Iranians have mobile phones and 21 million of a population of 70 million have Internet access, says the National Democratic Institute, a Washington- based democracy-promotion body.

Mousavi and Karrubi have used text messages, Facebook and Twitter to reach voters. Authorities blocked the two social networking sites on May 23, reversing the move 72 hours later after protests.

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