War in the Middle East and its impact on financial markets

War in the Middle East and its impact on financial markets

June 4, 2018

Table of Contents1 Do you know the impact of the war in the middle east?2 Review Of Various Markets in the Middle East2.1 Review of financial status In the stock market2.2 Review of financial status in the oil market2.3 Review of financial status in the currency market2.4 Review of financial status in the gold market2.5 […]

Do you know the impact of the war in the middle east?

War has always been a terrible word, and we have been facing many wars in the last 100 years.

The effects of the war on financial markets are not usually immediate. Take, for example, after the September 11th attack on the two-tier towers, there was no real reaction in the financial markets at all.

The dollar price index chart from September 11th, 2001 to January 1st, 2002:

 

 

 

As you can see, there are no significant changes in the dollar index. This is true even on the New York Stock Exchange 

We should not look for the effects of the war or terrorist incidents in the short term.

When a war begins, a lot of people in the war-torn country are going to emigrate. They will take their own money, gold or money, and this will not affect much of the world economy and financial markets.

Depending on where the war has taken place, it can affect the world economy, and today’s debate is a war in the Middle East and Syria.

The main source of fuel for the world is oil in the Middle East, so the war in this region will have its first impact on oil. Following the changes in oil prices, we will see a change in gold and silver prices and then in other markets, but today there is another new market which is called the digital currency market!

A few days ago, precisely on April 14, 2018, American, French and French troops fired several rockets into Syria and there was still no reaction from supporters of Syria, Russia, and Iran. On the other hand, Israel also had several attacks on Syria, and on one side the rest of the Middle East is in the war with Yemen, and if we look at statistical terms between the US-Saudi Arabia-Iran-Syria-Russia-Israel-Yemen, these wars have steadily risen in recent years.

What would the impact of the world economy in Forex markets, gold, silver, stocks and digital currencies be if the war happened?

America is the most influential country in the global financial markets and the reason is very simple on the grounds that the US has the dollar and the dollar is number one in the world. On the other hand, there are also the largest trading and capitalist companies in the world, and now it has one of the most profitable industries which are the military industry.

 

If the war begins, the United States can sell plenty of weapons and equipment. While no wars have yet begun, Saudi Arabia has bought a lot of military equipment and weapons, which means earning a lot for America.

 

 

 

On the other hand, according to American trade balance, it is constantly getting worse. That is, the United States is a big economic bankrupt

Let’s go back a little bit:

Some analysts call the American economy the war economy, but statistics also confirm this theory to some extent because every time a war has started with the United States or others, it has contributed to the economy of the country!

 

US Economic Downturns and Governmental Solutions

The beginning of the recession Deadline The war that ended the recession Time president
1930  More than a decade

America’s Great Depression

The second world war Andrew Jackson-Hawr-Roswell
1970 About five years Vietnam War Richard Nixon-Gerald Ford (simultaneously with the war)
1980 Six months The war between Iran and Iraq Jimmy Carter
1981 Sixteen months The rise of the Iran-Iraq war Ronald Reagan
1990 Eight months Persian Gulf War George Bush father
2001 Eight months War with Afghanistan George Bush Son

 

What is the solution for a high-deicide business to save itself? Now, it’s better to ask a question: Where is the safest place to invest if the war happens?

  1.  Stock market
  2. Oil market
  3. Currency market
  4. Digital currency market
  5. Or Gold market

Review Of Various Markets in the Middle East

  1. Review of financial status In the stock market

The stock market means buying shares of different companies in different countries; of course, it will be a good investment if we are sure that the war will end with the country we know. Take, for example, if we assume that the American war with Syria will ultimately end with the United States victory so American stocks are a very good choice to invest.

  1. Review of financial status in the oil market

The war in the Middle East would have an effect on the price of oil. If Iran were to enter this war, there would be a big chance to increase oil prices. So, in order to invest in the oil market, it is better to wait a bit to see if there really is a multilateral war between America, Russia, Syria, Israel, and Iran will be formed?

  1. Review of financial status in the currency market

Countries that are involved in warfare need to fund their own warlords or other countries, so the turnover of the foreign exchange market will rise at the time of the war. Apparently, Britain and France and the United States are united, so if the war does occur, it is unlikely that the fluctuations will be high. And it seems that if the war starts, the global demand for a pound of dollars and euros will decrease, on the one hand, these countries will have to pay the price of war. On the other hand, people are less willing to buy these currencies.

  1. Review of financial status in the gold market

Perhaps the market for gold and silver is a market that does not go too far in the war because these days few people can turn their capital into gold and carry it over and over!

  1. Review of financial status In the digital currency market

 

It’s a very personal opinion, but if it’s a war I’d rather turn my capital into a digital currency! To escape or migrate, nothing is easier than liquidity in a digital currency. The only thing you need to know is the email password and the digital wallet code! That is, if a person wants to escape the war-torn country if he converts his capital into a digital currency, the only thing that will need is a plain paper that he has written on his passwords or, ultimately, a digital currency wallet!

If we follow economic news and economic indicators, we will see that the change in the country’s interest rate, the country’s unemployment, the trade-weighted gross margin, and none of them affect the digital currency market, and it is only the supply and demand that triggers these currencies to have fluctuated.

On the other hand, digital currencies do not have any centrality. If the entire Middle East will be destroyed, digital currencies in cyberspace still exist and you have access to them! Of course, there is an important question here Do we really have to admit that how many electrons in an uncertain space that determines a number must be recognized as a currency?! Well, to answer this question, I refer to 100 years ago

When the money was for the purchase of coins, there were coins of silver and copper If people were being told 100 years ago, people would exchange paper instead of metal in the distance future. Would they believe it?! It seems that technology has moved to the point that we must accept that the digital world is a real world that we mistakenly called the virtual name.

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