Gun stocks soar after San Bernardino
05 December 2015 1:11 pm
The shares of gun companies have surged this year, and got a big boost after the San Bernardino shootings.
As reported here, Smith & Wesson’s stock has nearly doubled in 2015, while the company's sales are up 93 per cent to $500 million this year.
Smith & Wesson shares rose sharply after the San Bernardino shootings. Shares in Sturm Ruger and Company also surged following the appalling news.
When there is a tragic event, Americans rush out and buy guns because they’re scared Congress will bring in anti-gun laws. Indeed, Barack Obama’s presidency has stirred up anxiety among gun owners. As a result, gun makers have profited handsomely.
Yahoo Finance reports that Wedbush Securities estimates that wholesale sales of handguns and long guns (which includes shotguns and rifles) totaled about $4 billion in 2014.
And the great irony is that the demand isn’t coming from hunters. In the 31 years since the 1982 peak, the number of US hunting license holders has declined 13 percent to approximately 14.6 million in 2013, according to the US Fish and Wildlife Service. The demand is coming from people buying handguns.
There are now more guns than people in the United States. As the Washington Post reports, there would have been roughly 357 million firearms in the US in 2013 — 40 million more guns than people.
As a result, the United States is not a safe place. The Economist says the US has one of the highest murder rates among OECD countries—second only to Mexico. While the number of violent assaults in America is comparable to those of other western countries, murders are much more common. The prevalence of guns explains America's terrible record—they are used in two-thirds of all murders.
The bottom line is that the US gun industry views mass shootings as an opportunity to make lots of money with gun sales continuing to break records.
As Lee Fang writes in The Intercept, it’s the same pattern every time.
“Following a mass shooting, there is talk of gun control, which the National Rifle Association and other gun advocates attack as an assault on the Second Amendment. Notably, gun and ammunition manufacturers often donate, either directly or as a portion of each sale, to the NRA. The fear of losing gun rights leads to panic buying, which brings greater profits to gun retailers, gun companies and their investors.”
Which is why Congress is unlikely to bring in tougher gun laws.