The headline risk here, folks, is that if you wait for your central banker to give you insight into ...
11/26/2008 1:49 pm EST
I love this time of year! As we put the finishing touches on our Thanksgiving preparations here in the US, and although the world still faces major challenges, I can’t help but enjoy the feeling of well-being that ushers in the holiday season. The lights, decorations, family gatherings, and general kindness reassure me that worldwide we, as a people, are all striving toward similar goals: happiness, good health, and financial stability.
And around the globe, governments are trying to stabilize and restart their economies and markets. In the US, the Federal Reserve announced a sweeping, $800-billion program to back consumer loans and buy mortgages. The European Commission approved a €200 billion ($260 billion) spending plan for its 27 nations. And individual countries, including Germany, Hungary, Israel, the Netherlands, Russia, Spain, Switzerland, and the UK, all announced stimulus packages.
The markets had a couple of exceptionally good days this week, with the Dow Jones Industrial Average gaining some 900 points in two days. But most are posting losses as I write this midday, following the announcement of China’s fourth rate cut since September.
China slashed its one-year lending and deposit rates by 1.08%, the largest cut since the 1997 Asian financial crisis of 1997. The cut was on the heels of the report by the World Bank that forecast a slowing in Chinese growth next year, to 7.5%—almost a 20-year low.
The FTSE 100 is down triple-digits and the FTSEurofirst 300 is off 1.5%. The Nikkei closed down 1.3%, following Fitch’s reduction of Toyota’s credit rating, the company’s first downgrade in a decade.
Although this week’s news reinforced the volatility of current global markets, David Fuller, of Fullermoney, shared a fairly positive outlook for China.
John H. Christy III, editor of Forbes International Investment Report, offered a “safe haven” recommendation, and Gordon Pape, editor of The Canada Report, provided an update on a high-yielding energy trust.
Best wishes for a wonderful Thanksgiving to our US readers and high hopes for better market days ahead, worldwide.
Nancy Zambell edits Global Investing for MoneyShow.com. Her opinions are her own and not necessarily the views of InterShow or MoneyShow.com.
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