Sunday, October 26, 2008
The avalanche in Wall Street
The avalanche in Wall Street and burses all over the world is the sole point of discussions everywhere. In fact poor are bearing the burnt when they go to the market and fail to understand what relation the price of rice or cooking oil has with the stock market. So the middle class are, though most of them have burnt their fingers while participating directly investing in equities or through the mutual funds route. The worst sufferers are Americans, though the sub-prime crisis was initially caused by those who took loans but failed to pay. It is obvious that they have spent the money for procuring more goodies or using it for speculative purpose. But now their speculation having turned out to be abysmally wrong, many of them are filing for insolvency or bankruptcy taking with them till date no less than dozens of reputed bankers. The current symptoms suggest another great depression like 1929-30s is surfacing fast. Though the socialistic measure of pumping exchequers money into the banking system has been adopted by the world’s capitalistic champions like United States, England, German, Iceland and others, any positive signal is yet to elicit. Usually, what is found that when the stock market goes down, the commodity and bullion or crude market go up. But this time all are vying with each other to touch the bottom! Some effects sound good, like lowering of crude price beyond any speculative vision. But at the same time the metal index seeking bottom is alarming. The demand of steel, copper, zinc or any other metal when goes down, it indicates the related industry is going through a demand slump. This follows closure, lay –offs in industrial circle, causing unemployment all over, that results in recession with ever increasing trend.
What we are surprised to note, even now, lot many experts or investment Gurus, or economists are suggesting and foretelling different measures and outcomes. Even before their views are re-telecasted, most of them are turning worthless. So we wait to see what awaits in future with utmost uncertainties.