Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
According to CNN, a Malaysia Airlines flight from Amsterdam to Kuala Lumpur crashed Thursday in eastern Ukraine. In an announcement on Twitter, airline officials have confirmed that it lost contact with Flight 17 over Ukrainian airspace. All 280 passengers and 15 crew members were killed.
The Facebook page of Anton Gerashchenko, adviser to the Ukranian Interior Ministry, is saying that “the aircraft was shot down over Ukraine by terrorists operating a Buk surface-to-air missile system.” He claims that the plane was shot down near the town of Torez in the Donetsk region of eastern Ukraine as it flew at 32,000 feet.
Ukrainian President Petro Poroshenko released a statement saying that the Ukraine Armed Forces “did not fire at any targets in the sky,” but that they have not ruled out the chance that the plane was shot down.
CNN points out that “news of the Malaysian plane comes in the same week that Ukrainian officials said a Russian fighter shot down a Ukrainian military transport plane while the aircraft was in Ukrainian airspace.”
Richard Quest, an aviation expert for CNN, called this incident “extremely unusual.”
“This is in the rare, very rare category for an airliner potentially to be shot down, at altitude, 32,000 feet, simply because of the profile of an aircraft,” he said. “You can tell an aircraft, you can see a commercial aircraft. It looks like a commercial aircraft, it squawks a commercial aircraft. So something is absolutely appalling that’s gone on here.”
Tensions had calmed down significantly between Russia and Ukraine after a very shaky start to the year that led to the eventual annexation of Crimea. The news of a Russian fighter jet shooting down a Ukrainian jet on Wednesday had been the first major news in a while from the region.
The decreased tensions, as well as the speculation after last week’s Federal Reserve meeting that interest rates may be raised sooner than expected, have recently caused a dip in gold prices, as investors moved away from safe-havens and back into the equities markets.
Today’s news, however, was immediately followed by a big jump in gold prices. At the time of this article, gold was at $1,316.79 an ounce, up $17.92 on the day.
Global conflicts and potential economic turmoil typically mean positive moves for gold investors, as the yellow metal is commonly used as hedge against a drop in the markets and inflation. So, if this incident leads to a greater conflict and/or increased tension in the region, as well as in the world, then gold prices could be in for an even stronger run.