Tuesday, February 27, 2007

What Next?

World stocks plummet on China woe

Global stock markets have slumped, with the US Dow Jones index plummeting by more than 400 points and London's FTSE 100 index also posting sharp losses.

Posted by nearly30 @ 10:19 PM (2928 views)
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10 thoughts on “What Next?

  • Just heard on news @ 10 – everyone looking a bit shakey!!!

    What with the business news also featuring Private Equity – is this 1930s bubble economics – let’s see what happens next!

    Exciting – but also a bit scarey! Or – maybe just a damp squib?

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  • “There seems to be just an air of nothing is safe anymore, there’s nowhere to go and people are rotating into bonds as a safe haven.”

    True – even today I was reading about Tesco giving 50 year bonds and bond trading going a bit bear crazy!!

    Guardian “Tesco 50-year bond sells out in two hours” – did they know something was going to happen?

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  • when does a plummet become a crashet?

    BBC are careful to avoid the C word.

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  • You guys are kidding yourselves, a blip in the stock market is not going to lead to a massive house price crash.

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  • This morning it looks more like it was partially caused by mass profit taking after years of rises. So may have been a flash in the pan. Guess wewillfind out today.

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  • Dothink there will be a global stockmarket “crash”. Dividends to earnings ratio on major stockmarket indices are OK, most mainstream marets still below the peaks of 2000 and there has been considerable earnings growth since then. China stockmarket is suffering from major speculatrion so a correction there is ineviatble which sends a pit of panic elsewhere. At worse I think it will be like May last year and it may even bounce back in a few days

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  • David, why so defensive? No one said a fall in the stock market would mean a fall in house prices, though the two may be linked. Careful about the word “blip”: Nigel Lawson famously used it to describe the late eighties crash and recession.

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  • Lets not get too excited. In the crash of 1987 the DOW market fell 26% and in the UK some 25% and hong kong 45%. The sort of “crash” we are talking here is a fall of 2-3% so far….

    hardly that worrying!

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  • maddison, that’s right.

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  • The BBC has just reported that the fall was started by rumours that the Chinese government was to consider charging tax on stock market transactions, I was under the impression the fall in DJ and Chinese markets were caused by reports of low orders for the crap being made in China. Does anyone have a good handle on what caused the Chinese market to plunge 9% yesterday? If was just a threat by the government, then that would explain it and would also show that it is just a blip. If indeed it is reduced orders for manufacturing, then that points to a larger problem.

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