The big potential short term effect of the Ukraine war is on food availability and prices. Prior to the war Ukraine was a major exporter of grain and other staples:
https://www.reuters.com/markets/us/ukra ... 022-01-26/This year, Ukraine is predicted to account for 12% of global wheat exports, 16% for corn, 18% for barley and 19% for rapeseed.
Few things drive inflation like the fear of empty bellies and as wheat and corn are both human and animal food it seems likely that food prices will rise. Complications are that the production of fertilisers is also heavily dependent on gas and that has risen and so farmers need higher prices just to cover the fertiliser. It has the makings of a very ugly situation. I am personally ramping food production on my little organic farm as it would not surprise me if there are shortages and much higher prices this winter. Being organic saves me from the ramp in fertiliser costs.
Generally wars show humans for the stupid creatures we can be, but stupidity often bring opportunity. The war in Afghanistan lead to the break up of the Soviet Union and a huge peace dividend as the wall came down and many countries that had been under Soviet control since the 2nd War were liberated, Germany united, Poland freed etc. This might all end the very differently or similarly, I have no idea.
After the war is over there will be many re-building opportunities and all the construction firms and suppliers will do very well. While the war rages the main arms makers get a new order when every bullet, bomb, missile, drone etc goes bang and they will do very well. One danger is that the Russians are a super resourceful people who will likely develop defences against western technology and force the arms makers into a lot of expensive R&D in an arms race to stay ahead. Given how vulnerable tanks, helicopters and jets have proven to guided weapons it looks like the war if it continues will move to far more use of drones and that will add to the current chip shortages as the fabs get big orders for weapon components etc. There are those in the drone arms field who argue that a large drone cloud of self guided terminator drones is as effective as a nuke in killing soldiers and civilians but leaves most of the building undamaged. There is some data from Libya to support this belief.
An additional, hopefully low probability, possibility is that by calculation or accident the west and Russia exchange nukes. Russia has about 1400 operational nukes, 10% getting through is 140 big fires with lots of high altitude smoke and a following nuclear winter that will likely last for several years, wrecking global agriculture. If either side goes down this route their battle plan will almost certainly involve high altitude nuclear explosions to create electromagnet pulses that will down most of the world's internet and with it much economic activity.
All of this sits on a macro picture where most of the Western nations (not Germany) have excessive debt and all of them are loving the inflation that is reducing the debt piles but anyone who is living on a fixed income or who does not have an index linked pension is likely going to find it hard to pay for necessities like fuel and food and that can lead to civil unrest.
Meanwhile strong secular themes like the move to electric cars, renewable energy, AI in many professions will likely be made stronger by the events.
As I see it, if you know what you are doing, wars can provide opportunities for equity investors, but inflation as we have now can eat most of these opportunities, those who don't/can't invest are often broken by these levels of inflation. Traditionally gold was the hedge for inflation and it may work again, but crypto currencies are a new and unknown factor.
Additionally AI is beginning to replace humans and that will add secular disruption and luddite behaviour to society.
One has to be careful that one is not fighting the new war with the tactics of previous wars and there are very many new things happening in a world that has never before been so interconnected with all manner of counter party risk below the surface.
Regards,