Readers know I write a column for Inside Business, which I submitted yesterday. Here is the opening:
The sensitivity of stock markets to geopolitical events varies over time. Since the global financial crisis of 2008/9, our market has been extremely sensitive to them. But, over the last quarter, we have seen more Russian aggression against the Ukraine, practically assuring another recession in both Russia and Europe. A virtually unknown “JayVee” terrorist group has drawn us back into Iraq, and it even immortalized its own barbarism by publishing videos of their war crimes. Of course, Asia is not immune to geopolitical unrest, drawing closer to another “Tiananmen Square” in Hong Kong, which will unleash even more trade sanctions. And, the horror of Ebola suddenly popped up in America’s heartland, further rattling our faith in government.
Yet, the S&P 500 rose 0.6 percent, and the Dow rose 1.3 percent during Q3. This decrease in sensitivity to geopolitical events is simply breathtaking!