On Jan. 16, 1991, “Operation Desert Storm” began in the Persian Gulf. Americans watched on live television as U.S.-led coalition forces hit targets with missiles guided down a chimney or through a building’s window. Talk about pinpoint accuracy!
The market reacted with euphoria, as the Dow Jones Industrial Average gained 114.60 points the next day. The 4.6 percent increase was the second-largest jump in Dow history. The same day, gold and oil went into a spectacular free fall. Oil set a record one-day drop, plunging to $10.56 a barrel — a 74 percent decline from where it had been just six months earlier.
Does war always favor gold and oil and depress stocks? As the Gulf War proved, not always.