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Niall Ferguson

Investors Are Often the First Casualties of War

From Waterloo to the Ukraine crisis, fears of conflict have moved interest rates, boosted commodities prices and won (and lost) people fortunes.

The Duke of Wellington, financial warrior.

The Duke of Wellington, financial warrior.

Source: Hulton Archive via Getty Images

The Ukraine crisis may yet produce the biggest war in Europe since 1945. Or it may produce some strange new hybrid of cyberattacks, “little green men” and maskirovka (military deception) that won’t quite match our preconceived notion of war. Or — though this now seems the lowest-probability scenario — President Vladimir Putin may turn out to be Russia’s answer to “The Grand Old Duke of York,” who (as well-educated children know) “had ten thousand men / He marched them up to the top of the hill / And he marched them down again.”

In January, I warned: “War is coming.” Yet history is full of wars that nearly happened but then didn’t, from the Franco-German “War in Sight” crisis of 1875 to the Cuban Missile Crisis of 1962. For regular investors, these are nail-biting times because wars, unless they are very small and asymmetrical, tend to have big financial consequences. For speculators, by contrast, war scares are golden opportunities. Position yourself correctly, and you can make a killing if the dogs of war are unleashed — though if the hellhounds get sent back to their kennels, it’s you who gets killed and the guy who bet on peace gets the champagne.