Monday, Mar 05, 2007
A loss of liquidity is the real cause of stock market turmoil
Independent: Stephen King: How a small shock upset the apple cart
Stephen King, chief economist at HSBC, discusses the continuing sell off in global equity. He dismisses the reasons bandied around by traders such as Chinese regulatory changes and the allusion Alan Greenspan made to the possibility of a US recession. Instead, the key issue is liquidity, and the availability of cash to investors.
Posted by jellycaster @ 10:28 AM (169 views) Add Comment
5 Comments
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1. geed said...
"But with average debt levels standing at a historic high of 150 per cent of average income, consumer groups are warning that higher rates will have a devastating impact on overstretched borrowers.
'We are worried that there's a significant minority of people whose finances are precariously balanced on the edge of affordability, and they're the ones who are most at risk from interest rate rises,' said a spokeswoman from Citizens Advice, which recently reported a 15 per cent increase in the number of people coming to it with debt problems over the past year."
B#gger em! Learn to save or learn to do without!!! I'm in a sh!tty mood today....
2. geed said...
Ignore.....I am not with it today this was meant for the other post, I am in a even sh!ttier mood now....
3. harold said...
"A loss of liquidity is the real cause of stock market turmoil"
Yep, that sounds about right. Cheap money builds castles in the air. Sooner or later people wake up.
4. paul said...
So Mr Stephen King is taking time out from writing horror stories to write another horror story!
"Many have taken the view that there is simply too much "liquidity" sloshing around the system, a factor that apparently explains why all manner of asset prices have risen rapidly in recent times."
AGGGGHHH. The horror! The gore!
Glorious Sunshine will be cowering behind his sofa!
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