Asian and European markets are going down because of fear of a recession in the U.S. These fears surfaced on Wednesday, and the markets do not appear to be heading in a positive direction anytime soon. A recession in the U.S. will effect the stock market, business inventory levels, and general wages. Investors in Asia noticed that their average earnings from two businesses, Intel and Citigroup, dropped dramatically. They received a decrease of $1.3 billion. At the end of the trading day Japan's Nikkei index dropped dramatically and so did Hong Kong's Hang Sell, which received it's worse hit since the terrorist attack on 9/11/01. It is said the burden of the stock market falling is due in large part to foreign investors selling. This fear of a recession and stock market decreasing also hit Australia, they are scared that the market will continue on this downward spiral for a long time. There has also been a decrease in global growth. The US is the world's leading export market our numbers of profit in retail sales has fallen dramatically, causing many investors over seas to withdraw their investments. Many of the US problems occurred in the later months of 2007 and have carried on into 2008 and many fear that it might carry over into 2009.
Honestly, prior to doing this assignment I had no idea what global economics was. I can't really say whether or not I agree with this article, it sounds as if this article only gave emperical evidence so it's not really to much I can disagree with. I will however say this, I have to depthly look into this topic so that by the next blog I will be able to better understand this issue.
The article was written quite perfect, even though it seemed as if it was in a different language because I am not familiar with terms dealing with the stock market and how it effects the economy on a global level.
http://www.economicnews.ca/login.php?page=reportsDetails&newsid=41847&prevview=&view=details&country=Asia&plimit=0&category=Asian%20Economic%20Reports
1 comment:
That is really an interesting article and kind of frightening in the idea of the recession that could take place. With the facts that are displayed I have to agree there really isn't much to argue with, but I have to say it is quite interesting and will be something I will look into in the future.
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