Many thanks to ND for is excellent posts this last week with me being otherwise occupied. May they long continue. Although I have been rather busy, I did notice the rather large problems occurring in the stock markets of the world this week.
The most obvious points to remember are that many people in the markets are on holiday, so much of what is going on does not reflect true market sentiment., We have to wait for September to understand what is actually going to happen in the rest of the year. Secondly, until it is worked out who actually holds all this bad debt that has been issued on the back of dodgy US home loans, there will be rumour and change for some time to come.
So in short, the markets remain very volatile and prone to sharp falls on rumour alone.
This has not stopped those who should know better from encouraging people to get into the market; a little bit like recommending favourite cliffs to Lemmings.