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What The Markets Say About Bin Laden's Death: Cheaper Gas And Fewer Crazies

Glenn Beck gold

The geopolitical ramifications are, of course, the vastly more important ones, but the world economy shifted slightly last night as word of Osama Bin Laden's death hit the airwaves. If the markets are accurate, we're looking at world where there is less unrest in the Middle East, and, generally, less of a chance of everything coming completely apart at the seams.

Oil futures and the price of crude dropped last night as the news broke. Oil has been trending upward aggressively over the last three months because of unrest across the Middle East, but the markets are thinking that Bin Laden's death will keep it from getting worse. This is at odds with the fact that the Arab Spring is not based on Al Qaeda actions at all. And yet, the idea that some future Al Qaeda action could suddenly disrupt supply or start another war has to be priced into the cost of crude. Will an unintended consequence of Bin Laden's death be lower gas prices?

Perhaps more interesting is seeing the price of both gold and silver plunge. Sorry, Glenn Beck! Gold dropped to $1,540 an ounce after hitting a record high at $1,575.79, and silver fell a full 10%. Buying gold and silver is the province of crazy survivalists who think that having raw materials will be important after society collapses. (It's then also the province of people wanting to make a lot of money on crazy survivalists' fears.) In either case, while we question whether or not the world was made safer by Bin Laden's death, we can at least know that the gold and silver buyers—the people most afraid of something truly horrible happening to the planet—seem to think that it was.

Photo from Flick user monkey_bob99x

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  • Andrew Krause

    This kind of incompetent blathering is barely worthy of a blog, much less an alleged business magazine. All three commodities are responding to a weaker economic indicators in April, the reports of which came out late last week.

    Incidentally, gold has been a perfect hedge for any diversified portfolio long before Beck started pimping it to the end-times crowd. You've just insulted legitimate investors with this muck.

    Notwithstanding, futures contracts for all three items are up at present.

  • Johnny Quest

    Mr. Clendaniel was very eager to get this story posted this morning, and it is quite evident in his writing. The entire objective of this story is to say Ha Ha Ha-Na Na Na to Glenn Beck, or anyone who buys gold and/or silver. The world (not just the USA) is changing so fast that by the time Mr. Clendaniel posted his article, gold and silver SHARPLY rebounded (yeah, and where were you during the bull rally last week?). And crude oil is now higher as well. So, Mr. Clendaniel, why is this happening? I'll tell you... the US dollar is collapsing and about to lose its status as the world's reserve currency. Can we agree that there has been too much expansion of the money supply? No? Mr. Clendaniel, why has EVERY nation's mint on this planet (not just the US Mint) run out of silver? Supply and demand! When Glenn Beck starting touting Goldline (it could be ANY commodities broker) gold was less than $600 a troy once, and silver was less than $10 a troy ounce. So I ask, where are people supposed to put their hard earned money to protect themselves against the coming hyperinflation? Gold, Silver, Platinum, Oil futures. President Obama claims that there is no silver bullet to bring down gas prices. That's false. The USA has 700 million barrels of emergency reserves waiting, and plenty of natural resources to keep prices low. Releasing some of this reserve would also kill speculation over Oil futures and keep the supply chain flowing and allow for REAL economic recovery. However, that will not happen as we all know that this administration has no intention of doing anything like relieving peoples pain at the pump. So, Mr. Clendaniel, the smart people knowing this information are looking for a safe place to put their money. And THAT is why commodity prices are exploding. Mr. Clendaniel, do you think Glenn Beck influenced the Chinese government, or The People's Bank of China, to begin accumulating such large positions in gold? The Russians? The Australians? The Germans? Many governments have significantly increased their holdings of gold. Why has George Soros been hoarding gold (and silver) for several years now? This is NOT just a Glenn Beck creating fear issue (which is what this author is suggesting - he soooooo wants to be able to say "in your face Beck." However, that is so small minded of you Mr. Clendaniel), this is a global currency shakeup that may indeed change forever the monetary systems worldwide (my grandfather cursed Nixon for taking us off of the Gold Standard in 1971). No longer will the Federal Reserve be able to just print more of that fiat currency they keep chopping up and passing out to banks to distribute. Mr. Clendaniel, might I suggest reading any of the many writings of Milton Friedman. I suspect you might learn quite a bit. But before you begin reading, you might need to remove that chip on both of your shoulders (the chips filled with Federal Reserve Notes). It's amazing, anyone can be a writer and make a living, whether they actually have an informed opinion or not. Please, Mr. Clendaniel, continue your rant against anyone who buys gold and silver. I buy gold and silver, and LOTS of it. Am I going to buy real estate? Yeah, with high fuel prices continuing to climb there is about to be another round of mortgage foreclosures, which will probably touch off more bank failures (Hey Ben, print off another trillion of those FRNs for more QEing!). So, I should put my money in a bank and get 0.5% on a CD? Remember this, Mr. Clendaniel, if I'm wrong (or Glenn Beck or anyone of us crazies that understand how a monetary system is supposed to work), then I guess I'll just be stuck with beautiful St. Gaudens gold coins and all those amazingly historic Morgan Silver Dollars, and bank rolls of John F. Kennedy Silver Half Dollars. However, Mr. Clendaniel, if YOU are wrong... you are going to have gigantic problems. Have fun pushing your wheelbarrow full of Federal Reserve Notes to the market (I doubt they'll take your check, or even check card) to buy bread and milk. Yeah, and I'm the crazy one?