The Toll That War Could Take On The Economy

Now that there's war in the Persian Gulf, let it be a quick one.

In boardrooms, in office corridors, and on trading floors, as hope for a negotiated settlement gave way to the certainty that fighting would begin, the desire for a speedy resolution to the crisis dominated. And not merely to limit bloodshed: A prolonged confrontation between the U. S.-led alliance and Iraq, many believe, would only further damage an already fragile U. S. economy and jittery financial markets. "If the war drags on, there'll be a loss of self-confidence and a growth in uncertainty," warns Neal M. Soss, chief economist at First Boston Corp. "That'll hammer investment, housing starts, and orders for capital equipment."

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