Investors pull out of safe investment on news of bin Laden's death
Man holds a 'We Got Him' sign outside the World Trade Center site after the death of accused 9-11 mastermind Osama bin Laden was announced by U.S. President Barack Obama May 2, 2011 in New York City. Bin Laden was killed in an operation by U.S. Navy Seals in a compound in Abbottabad, Pakistan.
JEREMY HOBSON: Now let's get to the death of Osama bin Laden and the effect we're seeing in global markets this morning. Our regular Monday guest Julia Coronado is off today. We're joined instead by Adolfo Laurenti. He's deputy chief economist with Mesirow Financial in Chicago and he joins us now live. Good morning.
ADOLFO LAURENTI: Good morning.
HOBSON: Well tell us what effects you're seeing so far in the markets.
LAURENTI: Well so far we're seeing some advances on the equity market. As you have just mentioned, as also are seeing a strengthening in the dollar. And the price in oil, gold and some other commodity prices.
HOBSON: So some of these safe-haven places -- where investors put their money -- they're starting to pull out of that a little bit?
LAURENTI: Correct. Correct. And in part we think that this is a because of the decline in the strategic risk -- the risk of terrorist action and disruption so that has been a -- you know -- a trade mark for the past seven years.
HOBSON: And Adolfo, why would investors react with their money to something like this that may have no effect on the individual companies that they're invested in for instance.
LAURENTI: I think confidence is a large part of this story. Yes, there is a declining to strategic risk, but I also think it's a tipping point for all the people that have seen the economy improving but who are looking for a capitalist. Good news is that really would prompt to go back, take more risk and take action on this market. So the psychology's probably looming large in the market progress we are seeing today.
HOBSON: Adolfo Laurenti, deputy chief economist with Mesirow Financial in Chicago, thanks.
LAURENTI: Thank you.