06 October, 2008

Panic Selling Continues Post-Bailout, World Markets Plunge

No Hibernation for these economic bears even after the US Congress passed the $700Billion bailout plan, the second time through.  Fear spread throughout the world markets as Europe had to act in the wake of its own financial problems with big banks.

When the American Senate added a few popular tax incentives to the bailout bill the hope was that 2nd time's a charm for Congress. Indeed it was as the Bill passed and was quickly signed into Law by President George Bush.  However, selling on the News, coupled with additional Economic fears and a weekend of news coverage outlining Europe's banking problems spooked even the most Bullish of traders.

Jim Cramer himself came on this morning telling every day Investors to pull out money they need since the ship is sinking.  Time magazine has a depression photo on its front page and newspapers all over the country are headline their copy with "Disaster". Isn't it kind of an un-written secret that once Main St. starts talking about how bad things are the bottom is in sight? True enough, but we are in the midst of an economic crisis not seen ever in global Financial History.  There's no precedent for a credit crisis like we're seeing now! However, the US plan is a start, and if executed correctly will slowly but surely allow money to flow through to businesses and individuals throughout the US and globally.

That notion and a quick acting Global Financial System, bringing a co-ordinated quarter-half point rate cute is the only solace Investors have for a turnaround in the near term. Investors have to keep their heads down and brace for impact, but should take some faith in that fact that bigger players than myself and yourself have multitudes more capital on the line and at some point soon the great companies we've pooled our dollars together to fund will become or already are too cheap to ignore.

Days in the worldwide market-place like today are incredibly frightening to the everyday investors. When Britain falls 8%, France 9%, Germany 7%, Japan 3%, China 5%,  Canada 5% and so on, and so on, the pressure to throw the hands up and bail is all too great.

Tread slowly and wisely Investors, but be on the look-out for where the money's moving and when it starts to return. It'll happen quicker than you may think today.

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