This market is going nuts trying to figure out all the uncertainty. The market is roiled over a potential war with Iraq but the uncertainty lies not with its outcome but instead with its aftermath.

History has proven that when a dictator is overthrown, a power vacuum is created, leaving room for other tyrannical factions to take the place of the previous ruler. Such a case occurred both in the former Yugoslavia after the death of Tito and in the former Soviet Union when its leadership failed to bring peace to Afghanistan.

The uncertainty regarding Iraq questions whether peace will be established and whether it will be maintained. Iraq's political demography is comprised of the Kurds in the north, the Shiites in the south, and the Sunnis somewhere in the middle. These people have been ruthlessly killing each other for centuries.

A power vacuum resulting from the overthrow of Saddam Hussein will provide the latent potential for these three factions to make up for centuries of transgressions through acts of violent vengeances. Thus, the U.N. and the U.S. will find themselves attempting to mediate a violently aggressive family feud. We can win the war, but will we win the peace?

Uncertainty remains on the home front as well. Liquidity is declining. MZM (money to zero maturity), the Fed's current measure of our nation's money supply growth, is contracting. MZM, on an annual basis, is positive 8.2%, down from 13% a year earlier. The quarterly measure of money flow into the U.S. economy is at 13.3%, down from a little over 21% in the third quarter of 2002.

Presently, there is less money available for the average consumer to spend than there was a year ago. From late 2001 to April 2002, the money supply was down to flat. A comparison between an MZM chart and a Gross Domestic Product (GDP) chart of the same period clearly shows a definite similarity concerning up and down swings.

The value of the dollar has declined 33% from its highs two years ago. Yet, our export market is still in decline while our trade balance deficit shoots for new highs. Evidently, the dollar remains inequitably valued against the currencies of our trading partners.

There is yet an additional factor causing the GDP weakness-very low interest rates. Millions of Americans depending on fixed interest rate vehicles have seen their incomes decline between 40% and 60% from several years ago.

This leads us to the final question of whether the U.S. economy will settle on rising inflation, a mild case of disinflation, or the worst scenario of all-stagflation. That, I believe, is the uncertainty now roiling the U.S. stock market.