Research (Investicniweb.cz)
World markets  |  August 23, 2012 18:22:28

Art Cashin: Geopolitical risks could easily kill stock rally



Period of very low volatility in markets covering enormous tension that dominates the world economy. Art Cashin, of UBS stock market veteran, points out that the mixture of geopolitical risks dangerously overheated boiler and with them the blowout.

According to Cashin are many geopolitical risks are very few (or even all) included in prices of stocks and other assets. "The only exception is the oil market, which is sensitive to events in the Middle East," says the head of UBS brokers on the New York Stock Exchange, "but the price of oil reflects the risk only slightly."

Oil may not be such a problem

Jim O'Neill, famous economist of Goldman Sachs, considered the possible impact of armed conflict on the price of oil to be limited. With Cashin so completely match.

High prices in recent years, according to him, led to the search for new deposits, so that the global capacity significantly increased (eg in the U.S.). In addition, there was also adapting to demand. In addition, current prices considered reasonable current geopolitical risks. "Sometimes I ask myself, how much the price of oil will drop when the threat of war has passed," he wrote in his current report O'Neill.

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  • Additional risks

    Besides the risk of military conflict with Iran, Israel Cashin with concern the events in Syria. Can not be said to exclude the extension to other conflict areas. In recent weeks can feel unease example in Lebanon and on the border of Turkey and Israel.

    The situation in the Sinai Peninsula, Hezbollah's activities in Israel, China and Japan disputes on some islands, the possible escalation of social unrest in Greece, Spain, but also France - these and many other risks Cashin recommended to monitor and take into account when dealing. Autumn can be very wild.


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    Art Cashin: Geopolitická rizika mohou lehce zabít akciovou rally

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