Let me set the stage. The price of oil is up over 7.5% in the past month. We’re looking at the beginning of the end of quantitative easing in the United States and the consequent rise of interest rates. Escalating mortgage rates could frighten potential homeowners back into renting. We have a raging (as well as politicized) debate as to who should be our next Fed chair. Financial markets and currencies from many emerging economies are hitting the wall. The U.S. government is about to enter a protracted debt-ceiling debate. And, as if this is not enough, we now have a possible U.S. intervention in the Mideast that could rattle worldwide financial markets. The winds of war may breach any national border.
With this backdrop in mind, the question we must pose is this:
Setting aside the moral, ethical, and political conundrums of a U.S. intervention in Syria, how should we expect financial markets to react when conflict in the Mideast flares up? Read more