Economics Essay | Essay

This student essay consists of approximately 2 pages of analysis of "The Sky Is Falling" "buy Sky," July 17, 2006.
This section contains 430 words
(approx. 2 pages at 300 words per page)
Buy the Student Essay on "The Sky Is Falling" "buy Sky," July 17, 2006

"The Sky Is Falling" "buy Sky," July 17, 2006

Summary: When something is going awry, people, including investors, become fearful and get carried away. There is no meaningful supply of oil in Gaza, Israel, Lebanon, or Syria, but that has not prevented oil markets from rallying. Investors think they need less risk, pushing stocks down, and U.S. bonds and the dollar up. But the hostilities now taking place are unlikely to expand to engulf Saudi Arabia and other sizeable oil producers, particularly since the Saudis have already publicly blamed Hezbollah as the instigator. Those who can separate political events overseas from economic and profit growth domestically should find very attractive investment opportunities now in equities.
When something is going awry, people, including investors, become fearful and get carried away. There is no meaningful supply of oil in Gaza, Israel, Lebanon, or Syria, but that has not prevented oil markets from rallying. Investors think they need less risk, pushing stocks down, and U.S. bonds and the dollar up. But the hostilities now taking place are unlikely to expand to engulf Saudi Arabia and other sizeable oil producers, particularly since the Saudis have already publicly blamed Hezbollah as the instigator. Those who can separate political events overseas from economic and profit growth domestically should find very attractive investment opportunities now in equities.

The Chicken Little fable, best remembered for the first quote in the title above, is happening in the markets today. Oil, government bonds, and the dollar have risen as investors seek out what they perceive to be safer investments. Riskier investments, such...

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This section contains 430 words
(approx. 2 pages at 300 words per page)
Buy the Student Essay on "The Sky Is Falling" "buy Sky," July 17, 2006
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