Search

Political Risk Is At Its Highest Level Since 2003 – What It Means For the Stock Market

According to Saxo Bank’s head of commodity strategy Ole Hansen, one measure of political risk is at its highest level since 2003, during President George W. Bush’s invasion of Iraq.


Much of the recent political worry has centered on the musical chairs in the White House, with a number of high-profile Trump administration departures elevating concerns about turmoil in Washington, which threaten to upend the administration’s pro-business agenda.


Meanwhile, other macro analysts are pointing out increased risk tied to Special Counsel Robert Mueller’s investigation into members of the Trump campaign’s links to Russia in the lead up to the 2016 presidential election.


Mark Rosenberg, co-founder of quantitative research firm GeoQuant, says his gauge of political risk, dubbed the Mueller Risk Index, suggests that increased risk associated with the special counsel’s probe, including a possible impeachment, may actually help the dollar.


That’s a bit contrary to the consensus view, particularly since U.S. stocks enjoyed a stellar showing last year while the buck, as measured by the ICE U.S. Dollar Index, lost 10% of its value gauged against a half-dozen rivals.


Rosenberg said that “what’s new is that the dollar is less resilient than one would expect for a global reserve currency. Indeed, the U.S. political economy increasingly looks more and more like an emerging market; we should anticipate similar risks to emerge.”



With the dollar continuing to lose value and an increased sentiment that something is on the horizon that could drastically effect the stock market, it has never been more important to be proactive and look to diversify before its too late.

CALL TODAY

(833) 600-GOLD

Copyright © 2019 The Oxford Gold Group - All Rights Reserved. The statements made on this website are opinions and past performance is no indication of future performance or returns. Precious metals, like all investments, carry risk. Gold, silver and platinum coins and bars may appreciate, depreciate or stay the same depending on a variety of factors. The Oxford Gold Group cannot guarantee and makes no representation, that any metals purchased will appreciate at all or appreciate sufficiently to make customers a profit. The decision to purchase or sell precious metals, and which precious metals to purchase or sell, are the customer's decision alone, and purchases and sales should be made subject to the customer's own research, prudence, and judgment.