March 02, 2007

Stocks Drop: Now Three Days Straight

As Mike Whitney explains, it's not just a Chinese problem, is it?
We should expect to see bigger and more destructive market-fluctuations as investors get increasingly skittish over bad economic news and weakness in the dollar. Yesterday’s 400 point somersault is just the first sign that Greenspan’s Goldilocks’ economy is cracking at the seams.
The lastest BBC reports confirm his analysis:
The global sell-off was triggered by fears of a new tax in China on Tuesday, and has now spread to wider issues...

Since Tuesday and China's tax worries, investors have become more concerned about the state of the US economy and strength of the mortgage market.
You see, George, the problem with spreading irrational fear is that it can always turn around and bite you in the bum:
"Right now, everything and anything is viewed in a negative light," said stock analyst Dick Green. "It will take a while for the fears to calm down."


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