What does a peace dividend look like?

It's still early to tell if there will be a 'peace dividend' following bin Laden's death, but major peace events of the past have affected the markets

Joshua M. Brown
This chart shows the Dow Jones Industrial Average from 1940 to 1950, with arrows that show how the Dow reacted to Japan's first major defeat, Hitler's death, VE Day, and VJ Day. Will Osama bin Laden's death have a major effect on the markets?

The big discussion on the financial web will revolve around what Osama Bin Laden's death will mean for the economy and stock market. I don't have any answers but what I can provide is a little perspective.

Below I've charted up two different "Peace Dividend" charts of the Dow Jones Industrial Average following two major breakouts of peace. I am not inferring that Al Qaeda and terrorism are no longer a threat, I am saying that his death, when taken alongside the Arab Spring and its lack of Al Qaeda presence or influence, is potentially of monumental significance.

And here, the Mother of all Peace Dividends, the Fall of the Berlin Wall, followed by the Soviet Union's collapse and the end of the Cold War.

Add/view comments on this post.


The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on the link above.

You've read  of  free articles. Subscribe to continue.