Stock Markets Plunge Worldwide

[ayin jade]

Stock Markets Plunge Worldwide

Stocks fell sharply worldwide Monday following declines on Wall Street last week amid investor pessimism over the U.S. government's stimulus plan to prevent a recession.

U.S. markets were closed for Martin Luther King Jr. Day, but the downbeat mood from last week's market declines there circled through Europe, Asia and the Americas. Britain's benchmark FTSE-100 slumped 5.5 percent to 5,578.20, France's CAC-40 Index tumbled 6.8 percent to 4,744.15, and Germany's blue-chip DAX 30 plunged 7.2 percent to 6,790.19.

In Asia, India's benchmark stock index tumbled 7.4 percent, while Hong Kong's blue-chip Hang Seng index plummeted 5.5 percent to 23,818.86, its biggest percentage drop since the Sept. 11, 2001, terror attacks.

In Canada, the S&P/TSX composite index on the Toronto Stock Exchange fell 4.8 percent. Brazilian stocks plunged 6.6 percent on the main index of Sao Paulo's Bovespa exchange, and Argentina's benchmark Merval index fell 6.3 percent to close under 1,900 for the first time since August 2006.

Investors dumped shares because they were skeptical that an economic stimulus plan President Bush announced Friday would shore up the economy that has been battered by problems in its housing and credit markets. The plan, which requires approval by Congress, calls for about $145 billion worth of tax relief to encourage consumer spending.

"We've taken our lead from the Asian markets who have not been impressed by the U.S. There's debate if there's going to be a recession in the U.S. I don't think there's much chance of that though," said Richard Hunter, an analyst at Hargreaves Lansdown Stockbrokers Ltd. in London.

Concerns about the outlook for the U.S. economy, a major export market for Asian companies, has sent the region's markets sliding in 2008. Just last Wednesday, the Hang Seng index sank 5.4 percent.

"It's another horrible day," said Francis Lun, a general manager at Fulbright Securities in Hong Kong. "Today it's because of disappointment that the U.S. stimulus (package) is too little, too late and investors feel it won't help the economy recover."

Japan's benchmark Nikkei 225 index slid 3.9 percent to close at 13,325.94 points, its lowest close in more than two years. China's Shanghai Composite index plunged 5.1 percent, partly on worries about mainland Chinese banks' exposure to risky U.S. mortgage investments.

"People are certainly nervous about a potential recession in the U.S. spilling over to the rest of the world," said David Cohen, Director of Asian Economic Forecasting at Action Economics in Singapore.

Cohen said there may be "still some wariness" about politicians being able to come up with a compromise and act sufficiently quickly on a stimulus package. "I think the impact would be marginal anyway," he said.

Investors took cues from the negative reaction to the president's plan on Wall Street on Friday, when the Dow Jones industrial average slid 0.5 percent to 12,099.30, bringing its loss for the year so far to nearly 9 percent.

Traders also have shrugged off assurances from Federal Reserve Chairman Ben Bernanke that the U.S. central bank is ready to act aggressively

[O'Dannyboy]

All thanks to some greedy underhanded lending institutions who did a bait and switch on millions of homebuyers. What did they expect to happen when millions of people are suddenly unable to make their house notes? I understand that these people knew what they were doing when they signed the mortgage but that doesn't excuse the lenders from conceiving such a half baked and greedy trap. The lenders will get their money and at the expense of all those they duped. Meanwhile they have thrown a wrench in the machine which has caused many people to become thrifty spenders and in turn has caused investors to be more shrewd as well. If they are going to do something with that stimulous package, they better do is soon. This stimulous package could, however, set tax returns back as far as the end of summer, which could also hurt the economy if they don't kick it into gear.

[EndDays]

All thanks to some greedy underhanded lending institutions who did a bait and switch on millions of homebuyers. What did they expect to happen when millions of people are suddenly unable to make their house notes? I understand that these people knew what they were doing when they signed the mortgage but that doesn't excuse the lenders from conceiving such a half baked and greedy trap. The lenders will get their money and at the expense of all those they duped. Meanwhile they have thrown a wrench in the machine which has caused many people to become thrifty spenders and in turn has caused investors to be more shrewd as well. If they are going to do something with that stimulous package, they better do is soon. This stimulous package could, however, set tax returns back as far as the end of summer, which could also hurt the economy if they don't kick it into gear.

Unfortunately the lenders don't care. They will get bailed out with our tax money.