You open your phone on a Monday morning and the market is down 900 points. Oil has just cracked $100 a barrel. Asian markets are circuit-breaking. And somewhere in the news feed, between the headlines about the Middle East and a tweet from President Trump, there's a financial commentator telling you this could be "the big one."
Here's what I've learned: it almost never is.
Right now, the US-Iran war is the story dominating every market on earth. Oil is spiking. The Strait of Hormuz — the narrow waterway that roughly 20% of the world's oil passes through — is under threat. Asian markets, which import the bulk of that oil, got hit hardest. Japan's Nikkei fell over 6% in a single session. Korea's KOSPI triggered a circuit breaker.
And yet. The S&P 500 recovered. The ASX held relatively steady. By mid-week, markets were already clawing back.
This is how it almost always goes.
What Geopolitical Shocks Actually Do to Markets
The honest answer is: they create short, sharp volatility — and then markets move on.
This isn't me being flippant about war. The human cost of conflict is devastating. But investing is about understanding how markets price risk, not about predicting history.
Historically, geopolitical shocks — wars, terrorist attacks, political crises — tend to produce a predictable pattern. Markets sell off hard and fast. Panic spreads. Then, once investors realise the underlying economy is still functioning, money flows back in. The sell-off rarely lasts as long as the fear.
BlackRock put it plainly this week: disruptions to global energy are "likely to be short-lived." That doesn't mean risk-free. It means the base case, historically, is recovery.
The Assets That Actually Move in a Crisis
Every crisis has a playbook. Here's where the money went this time:
Oil surged — obviously. Brent crude topped $100 briefly before pulling back. Energy companies like Chevron and Exxon were among the only green names in an otherwise red market. When supply is threatened, the commodity spikes. That's simple economics.
Gold hit $5,181 per ounce this week. It's had a remarkable run over the past year, up from levels that felt elevated twelve months ago. In a world of geopolitical uncertainty, gold does what gold has always done — it holds attention as a store of value. Not a guaranteed safe haven, but a very old one.
The US dollar strengthened — which surprises some people. In crises, capital tends to flow into the world's reserve currency. Oil is also priced in USD, so demand for oil creates indirect demand for dollars. The dollar bears had a quiet week.
Bonds behaved strangely this time. Normally, investors rush into government bonds (US Treasuries) when things get scary — it's the classic "flight to safety" trade. This time, bond yields stayed elevated, partly because of inflation concerns from the oil spike. When inflation fears compete with safety fears, bonds get complicated.
Bitcoin dipped and then stabilised around $69,000. Some investors bought it as a hedge — a "digital alternative" to traditional safe havens. It's still down more than 40% from its October 2025 peak of $126,000. Crypto's crisis behaviour remains unpredictable. Don't let anyone tell you otherwise.
What Long-Term Investors Should Actually Do
Nothing dramatic.
I know that's unsatisfying when the world feels like it's on fire. But panic-selling into a crisis is one of the most reliably bad decisions a long-term investor can make. You lock in losses, you miss the recovery, and you're left trying to pick the "right moment" to get back in — which, as I said in Issue #1, is a game nobody wins consistently.
If you're invested in diversified ETFs across global markets, you already have exposure to oil companies, gold miners, and defensive stocks as part of that diversification. The portfolio is doing its job.
If you're holding individual stocks in sectors directly affected — airlines, cruise lines, and anything tied to Asian imports took serious hits this week — it's worth reviewing your thesis, not your emotions. Is the business fundamentally impaired, or is this a temporary shock to sentiment? Those are very different situations.
The discipline isn't in knowing what to buy. It's in knowing when not to sell.
Key Takeaway
Geopolitical shocks are loud, scary, and move fast. The market's reaction is almost always faster than the news cycle, and recovery tends to follow. Energy, gold, and the USD benefit when conflict touches supply chains. Long-term investors who stay diversified and stay calm tend to come out the other side in better shape than those who try to trade the headlines. The world has been complicated before. Markets have survived it before. The compound keeps working — quietly, relentlessly — even when the news doesn't.
That's the compound. That's the chill.
— ToNI NG.
This newsletter is for informational purposes only and does not constitute financial advice. Always do your own research.
