The most powerful war prophet

The capital market seems to be a rabble, but in reality, it is a multitude of fools who are wise and have more insight into current events and war prophecies than almost any expert.

The following article comes from the position of the wealthy, by the position of the wealthy

At the previous stage, Barton Biggs, the former chief strategy officer of Morgan Stanley, died, and I remembered that I had also bought two of his books; one was “The Hedge Fund Book”, while the other was “Wealth, War and Wisdom”.

However, in the latter book, all the characters were in traditional Chinese, which made my head spin, and after reading a few pages, I put it down. Later, I learned that the simplified Chinese version of this book is called “World War II Stock Market Records”, published by CITIC Press, and I already have the electronic version of the book.

The book, which focuses on the performance of the capital markets of the major Western countries involved in the Second World War, is particularly interesting in that he finds the stock markets of the various countries to be essentially the greatest prophets of war.

Let’s take it one country at a time.

(1) United States

The United States has been the world’s largest economy since 1913, and its total industrial output exceeds that of Britain, France and Germany combined. At the beginning of World War II, Americans still held the “isolationist” view that the bad guys in Europe fought, and we just made money and didn’t care about them.

People may think that the United States did not participate in the war, selling a variety of war materials, must be making a lot of money, so the stock market should also go up, right?

Actually, it doesn’t.

Whether counting from July 1937 after Japan’s full-scale invasion of China or, for that matter, from September 1939 after Germany’s attack on Poland, the U.S. stock market performed very poorly before the U.S. entered the war.


In 1939, the Second World War broke out in Europe, and from 1939 to the end of 1941, the U.S. was a “belligerent neutral”, but all investors knew that war was not good for the stock market, so even though the U.S. stock market was already at a very low valuation level, the stock market point was still down.

In particular, the beginning of May 1940, Hitler launched the “Low Countries Blitz”, the next few days, the total collapse of the French and Belgian armies, the surrender of the Netherlands, followed by the surrender of France – the U.S. stock market plummeted, the Dow Jones Industrial Average from 150 The U.S. stock market plunged, with the Dow Jones Industrial Average dropping from 150 to 112 points, a 25 percent drop in less than a month.

In December 1941, Japan attacked Pearl Harbor, the United States officially entered the war, but, in early 1942, the British and U.S. allied forces, in the Pacific theater frequent losses, what the Bataan Death March, the fall of Corregidor Island, the fall of Singapore and Kuala Lumpur, etc., which let the U.S. stock market deeply hit, April 30, 1942, the Dow Jones Industrial Average fell to the lowest point during the war 92 points, compared to the pre-war 150 The Dow Jones Industrial Average fell to a wartime low of 92 on April 30, 1942, down about 40 percent from its pre-war level of 150.

However, just as Americans had little faith in winning the war, the U.S. stock market bottomed out – at a time when the U.S. Army, having just suffered a crushing defeat in the Philippines, was being driven back in disarray by the Japanese.


Just after the bottom of the U.S. stock market, the Battle of Midway broke out, in which the Americans contained the momentum of the Japanese attack and dealt the first heavy blow to the Japanese fleet, a naval battle that thus became the turning point in the Pacific theater.

The stock market, it seems, foresaw that the United States was about to win a certain battle, and would step by step towards more victories.

Thus, a new bull market had been created and was going to bring the U.S. stock market into a post-war boom that was unimaginable to people.

(2) Britain

At the time of the start of World War II, Britain was still the nominal world dominant power, although it was already far behind the United States in the inside.

Unfortunately, at the beginning of World War II, Britain was beaten to death and the British and French allied forces were defeated. In 1940, in Hitler’s blitzkrieg against France, the British and French allied forces were almost wiped out, and it was only by the Dunkirk retreat that the main living forces were saved.

In July 1940, fearing that Germany would cross the sea, and especially fearing that Germany would use the French Navy to attack Britain, the British Navy demanded that the French Navy submit to Britain.

In September 1940, London thus became one of the three most heavily bombed cities during the Second World War.

However, London’s stock market, which had magically reached its lowest point before the Battle of Oran, seemed to know that the British would be able to ensure that the navy would be stronger than Germany’s and that Britain would not be occupied by Germany – even though Germany, at that time, was almost at its height.

Then in September 1940, Hitler launched the London air raid, and Nazi Germany’s planes bombed all over the major cities and industrial centers of Britain, but the British stock market was steadily rising amid the catastrophe of the London air raid, especially, when Germany attacked the Soviet Union, the British stock market came in a strong wave of pulling up.

The entry of the United States and its poor performance at the beginning of the war caused the London stock market to fall for a time, but just before the outbreak of the Battle of Midway, the London stock market reached the same short-term bottom and has been rising ever since, as if it knew for sure that victory would belong to the Allies.


(3) Germany

At the beginning of Hitler’s rise to power, the German stock market was down.

However, once Hitler really solved the German unemployment problem and industrial production recovered quickly, the German stock market started to rise until the eve of Hitler’s Second World War.

At the beginning of the war, the stock market was skeptical of Hitler’s military adventures, so it was down all the way. But with the “Blitz”, the German stock market began to rise – even at the beginning of the German attack on the Soviet Union. But as the Soviet war offensive stalled, the German stock market also stalled and fell.

Later, Hitler’s government began to regulate the stock market, and there was nothing more to say.


It should be noted here that while the Second World War was underway, only the United States did not devalue its currency much, and Britain nominally did not devalue its currency much, but the currencies of the other countries involved in the war, all experienced severe devaluations.

Therefore, starting with Germany, the stock market points of France, Italy and Japan were all inflation-adjusted index points.

(4) France

The French stock market fell all the way before the start of World War II, and after the war broke out, the French stock market was beyond decline.

In June 1940, France suffered a humiliating defeat and then chose to surrender, setting up a Vichy puppet regime, but under the leadership of General de Gaulle, the French set up a government in exile in England and kept fighting.

During the period of following the Germans, along with the success of the Germans, the French stock market under the puppet government also went up rapidly until the outbreak of the Battle of Stalingrad.

As soon as the Battle of Stalingrad started, the French stock market peaked (the German stock market was already regulated at this time), which seemed to foreshadow the outcome of the battle.

Since then, the French stock market has fallen and never had a decent rally, which foreshadowed the fate of the puppet government.


What is known is that the Second World War, probably the most brutal and catastrophic long war ever fought by mankind, and the stock market on both sides of the rivalry, were fools into wisdom and showed a surprising insight.

In times of peace, the stock market is a barometer of the economy.

In times of war, the stock market is the barometer of the battlefield.



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