The Dow dropped 140 points in August 5, 2014 on a rumor that
the Russian military is about to invade eastern Ukraine. Three days later, amid
hints of de-escalation and the end of troop “exercises” on the Ukraine border,
the Dow gained 186 points. Three days later, as Russia’s president approves a
deal wherein the Russian OAO Rosneft and the American ExxonMobil can begin
drilling a $700 million well in the Arctic Ocean, the Dow gains 16 points.[1]
Are stock analysts and Wall Street investors really so hypersensitive to day-to-day
changes in geopolitical risk? It may be simply that such news sells.
The entire essay is at “Global
Geopolitical Risks”
[1] All
quotes are from Adam Shell, “If Russia Sneezes, Wall St. Gets a Cold,” USA Today, August 12, 2014.
