Friday, 09 November 2012

Obama Reelection Boosts Gun Stocks and Sales

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Although many stocks traded on the New York Stock Exchange suffered a significant drop in their value on the day after Barack Hussein Obama was reelected president of the United States, there was one industry that experienced a significant boost: small arms manufacturers. With the president threatening to further interfere with the rights of American citizens to keep and bear arms, those citizens are acting quickly to procure as many firearms as they can, and the companies that manufacture those firearms will have a hard time keeping up with demand.

As reported previously for The New American, the reelection of President Obama and the threat of continuing gridlock on Capitol Hill was received as bad news on Wall Street, with the Dow Jones average dropping 313 points in one day. As Raven Clabough wrote:

According to USA Today, the election results contributed to the drops at least a little: “Investor reaction is decidedly negative over the defeat of the more business-friendly Mitt Romney.”

Likewise, fears were exacerbated on Wednesday when European Central Bank President Mario Draghi indicated that he was concerned about the outlook of Europe’s economies, particularly Germany’s.

However, the failure of Congress to reach a conclusion on how to avert the impending fiscal crisis by the end of the year is believed to be the most significant contributing factor to the 313-point drop. Many are concerned that Congress will be unable to reach a compromise during a lame-duck session.

"The chances of going off the cliff probably just increased," says Ed Yardeni, chief investment strategist at Yardeni Research.

However, weapons manufacturers are an industry that continues to run counter to the larger trend of ongoing economic decline. An article for Bloomberg noted that Smith & Wesson and Sturm Ruger & Co. were among the companies benefiting from Obama’s reelection:

Shares of Smith & Wesson jumped 9.6 percent to $10.37 at the close in New York, the biggest gain since Sept. 7, while Sturm Ruger & Co. (RGR) rose 6.8 percent to $47.68. Both make handguns as well as rifles that include semiautomatic models.

After sidestepping gun-control measures in his first term, Obama said last month he would consider reintroducing a ban on civilian purchases of military-style assault weapons. Firearm sales have grown at 10 percent annually since 2008, when Obama was elected, compared with a 7 percent rate from 2001 to 2007, according to Benchmark Co.

The nation’s continuing economic difficulties, including runaway government deficits, lackluster job creation by private industry, and looming threats of new military action in the Middle East have increased the sense of uncertainty at home. And when Americans are worried about instability at the same time that the president is threatening to further infringe on their right of self-defense, conditions are perfect for a substantial spike in civilian gun sales. One writer for MSN Now quipped: “Those folks Obama once famously talked about as clinging to their guns are apparently expected to cling to more of them now that the president has been re-elected." And an article for Investors.com noted that those citizens who are “clinging to their guns” have good reason to be concerned:

Less than 24 hours after President Obama's re-election, the U.S. Mission to the United Nations helped move the U.N.'s Arms Control Treaty a step closer to enactment. America joined 157 other nations in voting Wednesday to finalize the treaty in March. None was opposed and there were 18 abstentions.

U.N. delegates and gun-control activists had complained that talks collapsed in July largely because Obama feared attacks from Republican rival Mitt Romney if his administration was seen as openly supporting the pact. But once the election was over, the Obama administration had more flexibility to pull the trigger on supporting the pact.

The spike in gun and ammunition sales is already being noted by online companies. For example, on November 9 Ammoman.com informed its customers:

PHONE LINES ARE JAMMED.......PLEASE E-MAIL QUESTIONS AND PLACE ALL ORDERS ONLINE.

It might take a few days to respond to an e-mail. We are about 3400 e-mails behind. We have hired extra people for the office and we are working nights to get this done.

Order confirmations may be delayed due to the volume of business, please do not re-order because you may be billed twice.

Looks to be a delay in shipping the most recent orders. Please be patient with us as we are swamped.

Not only are citizens concerned that the newly reelected president could be a threat to their Second Amendment liberties, they are increasingly concerned that unconstitutional restrictions on the rights of citizens to defend themselves be lifted immediately. Thus, in the state which most significantly hampers the right of self-defense — Illinois — a new push is already underway to remove an unconstitutional law forbidding concealed carry of a firearm. According to an article for the Associated Press, 10 counties in Illinois are already pushing for repeal of the law:

Residents in some Illinois counties sent a message to lawmakers this week: Give citizens the right to carry concealed weapons.

Measures supporting concealed carry were on the ballot Tuesday in at least 10 mostly rural counties — Adams, Bond, Henry, McDonough, Mercer, Randolph, Rock Island, Schuyler, Stephenson and Warren — and passed overwhelmingly in every one.

The votes were non-binding because local law cannot override state law. But advocates say they hope to build pressure on lawmakers to support concealed carry.

Illinois is the only state where carrying a concealed weapon is entirely illegal.

Last year, Wisconsin adopted a licensing system for issuing concealed carry permits, making Illinois the only state that has no provision for concealed carry. However, many states still place significant restrictions of Second Amendment liberties.

The reelection of President Obama and the ensuing concerns that further abridgments of fundamental liberties may soon follow may lead to the right of self-defense proving to be the next great struggle in the American body politic — one which citizens will be unwilling to concede to regulation by the United Nations or a diktat from D.C.