By Rick Glaze

I think it is safe to say that the price of oil has collapsed in the last several weeks. Just above $64 per barrel at this writing, it is down $13 since July.

Stockpiles in oil inventories are at high levels, above their five-year average; tensions in the Middle East have subsided; and new oil discoveries in the Gulf of Mexico, as I mentioned last week, are coming together to help push oil prices down.

With these fundamental factors in place, some analysts speculate that the price could fall to $45 per barrel next year. Seems farfetched, right? But when interest rates were at 15 percent in the early 1980s, who would have thought that they would go to 1 percent? But they did, and oil might.

How might the fight against terrorists affect your investments? The greatest risk to economies, stocks and jobs worldwide is an indecisive response. During World War II, the Dow Jones Industrial Average slumped as the Germans marched across Europe.

After Pearl Harbor, when U.S. resolve strengthened, the index recovered and more than doubled from 1942 to 1946. A strong market also followed resolute action in the Kuwait war in 1991. The markets took off in 2003 when action was taken in Iraq.

In contrast, the meandering during the war in Vietnam dragged the same index down 30 percent.

Regardless of whether or not we feel that conflict is necessary in a given situation, the lesson is that a tepid response now to terrorism may have very negative implications for the international economy and the investment markets in the long run.