Saturday, February 6, 2010
Global Markets Shudder
This article is about the effect of the problems in Greece on the global market. Many of these dire effects on the world market are likely to be caused by expectations. The author seems to worry that the troubles in the European bond market will slow the world economic recovery from the recent real estate crisis. The price of gold even dropped, which is unusual in a time of crisis. The euro is actual at an eight month low against the dollar. This is causing investors to take their money out of the European market and put it into the safer U.S. Treasury bonds and even some are investing in the yen again. I liked this article because it really shows how an economic failure in one small part of the world affects everyone else. The world markets are competing, but a powerful nation cannot do too poorly or it will take the others down also.
Subscribe to:
Post Comments (Atom)
I liked how the article talked about the countries taking the biggest hits being the ones with the highest recent economic growth. It goes back to what we discussed in class this week about little-to-no fiscal discipline and how hard it is to overcome because once money is being spent on something it is hard to stop. I also found it interested how the psychological threshold of 10,000 in the Dow Jones has such a big impact on expectations.
ReplyDeleteI think this article analyzes the crisis happened in Greece explicitly; it includes how serious it is, and what influence it would impact on other countries. Also, I agree with the conclusion in this post that this article demonstrates how an economic failure of one country could affect the whole economy of the whole world, which gives us a warning that we should more cautious to cope with the pace of the globalization of the economy.
ReplyDelete