Rereading the article, I don't think the author is claiming that at all. The wording of the original yc comment framed the question in terms of whether wars are good or bad or what constituted a war, etc., and that's how we followed, but all the author claims is that wars=inflation and that good dow years follow inflationary spikes.

I would imagine that the only reason why someone would posit this correlation would be to say something on how to view our current situation, and I think he's saying that we've had a bad 10 years (logarithmicly speaking), but once we're out of this war (by him, inflationary) period, things will be great.

I'm not sure if I buy this argument or its implications, but the omission of korea, panama, gulf war 1 and somalia and the inclusion of the GWoT don't "ruin" it for me, at very least.

Thing is, I don't necessarily buy the original authors assertion. It's just that there are lots of other things that could easily have an effect, such as investor mood, government spending tie-ins like growing debt (or debt ratio) and inflation, diversion of investor money from things with higher growth potential into things that have immediate profits, like Xe...

None of those necessarily have a great deal to do with troop strength, but they do all seem to correlate with (some) wars.