Global Stocks Enter Bear Market

Stocks sank, dragging a gauge of global equities into a bear market, Treasury 10-year yields slid to a record low and the Dollar Index rose to a seven-month high amid concern central banks are running out of tools to prevent a recession. Commodities erased gains for the year.

The MSCI All-Country World Index plunged 4.5 percent at 4:39 p.m. New York time and is down 22 percent from its May peak, while emerging-market stocks tumbled the most in almost three years. The Standard & Poor’s 500 Index lost 3.2 percent to 1,129.56 after briefly falling below its 2011 closing low. The Dow Jones Industrial Average slid the most over two days since 2008. Ten-year Treasury yields lost as much as 16 basis points to 1.6961 percent. The Dollar Index rose 1.4 percent.

And the flight to liquidity and cash is on. Remember the insiders are near the door in the proverbial theater and someone just yelled fire. The first ones out will escape mostly unharmed, it's the ones that are in the middle that will get trampled on their way to the door.

The world is on the eve of the next financial crisis, with sovereign debt at its epicenter, said Mohamed El-Erian, chief executive officer of Pacific Investment Management Co., which runs the biggest bond fund. The European Central Bank hasn’t put in place a “circuit breaker” to contain the region’s debt crisis, El-Erian, who is also Pimco’s co-chief investment officer, said at an event in Washington today.

Source

Hate to say it again, but this is shaping up to be as bad or much worse than 2008. This whole thing kicked off when markets should have remained solid. Hate to see what this is going to look like next month when the markets are usually at their weakest anyways.

invest in hanging rope as it will be a best seller this year!

Its going to be interesting to see how Europe handles its financial crisis compared to America, either way, somethings heading this way.

Dead by dawn.
Secondline.

It's important to remember that there is no 'American economy' or 'European economy'. Unfortunately for everyone the world economies have been so inextricably interwoven over the last decade or so that we now only have a 'Global economy'. Sure, you can make relatively minor local adjustments, but with the scale of leveraging and debt spread around the world it's like being trapped in an elevator. If someone gets sick... we ALL get sick.

So when europe sneezes then we catch a cold no?
Its really very simple...there is nothing sacred.
Not cash ,nor precious metals,nor land titles , or businesses......Its a crap shoot as to who will survive because the conections are vast and intertwined like never before......The one thing bursting will surely effect all others...
Real estate bubbles, bank bubbles, debt bubbles whatever,........
Fleeing from stocks to worthless cash may be a dead end too....
You cant eat gold and silver and there is nobody with food for sale when the world is starving.....Not at any price.
Having a bolt hole on the land is great till its downwind of some fukishima or other.....
And one is stuck with a relatively static defensive posture too.....
Its all pretty much catch as catch can i think.....
Good Luck all..........

reply to post by SpaDe_


Do you mean Bear as in Russian or Bare as in Stripped Bare?
Second.

Originally posted by ldyserenity
reply to post by SpaDe_

 

Do you mean Bear as in Russian or Bare as in Stripped Bare?
Second.

No it's bear as in grizzly bear. Just market terminology. Bull markets are usually in times when the markets are doing well, Bear markets are when it is hard to profit from the market, or they are in a pull back.

yeah, yeah, yeah.... its a crash... at least for the next 12 hours...

all the traders and hedge funds managers will be leveraging the $289 drop with their creative ways


sure---- eventually, even with the PPT and cartel of private banks receiving clandestine funds from the Fed...
the market will climb back to the 11,400 level in quick order.


doomsday scenarios are too premature and hyperbole (wishful thinking by all the cynics)

reply to post by St Udio


Mirrors my own sentiments perfectly..

There simply won't be a real "crash" without first being a major calamity that will in turn bring down the markets (like SocGen failing.. or USBS) or perhaps Greece defaulting (though Greece is a tiny insignificant nation and exposure is limited)

Even if we briefly touch 10k as we already have this year, I see it bouncing back..

In short.. there's much more pain to be had before the fat lady sings.