As just explained, the death of terrorist leader Osama bin Laden probably raises more questions than it answers. So even though the news might seem good for business, the market is right to treat it with restraint. Although it creates uncertainty about national security, it may provide greater certainty for the 2012 election.
A friend of mine stated it brilliantly in his Facebook status late yesterday:
Did you hear that Obama was re-elected tonight?
Up to now, Obama's reelection wasn't looking all that promising. His approval rating has fallen from the high 60% range in early 2009 to the low 40% range last week, according to Gallup. Anecdotally speaking, many people I know that were big Obama supporters in 2008 had become disillusioned with the President. But acting as commander-in-chief when U.S. forces killed the most wanted terrorist in the world is a game-changer.
It might be a little bit of an exaggeration to say that Obama will definitely win reelection thanks to the death of bin Laden, but it certainly helps a lot. The economy will be the biggest issue in 2012, and the unemployment rate will likely remain uncomfortably high even then. But Republicans will have a hard time criticizing Obama for being too weak on terrorism or national defense, considering that he was in power when bin Laden was killed.