Despite the media’s effort to reassure the consumers that the crisis is under control – if not almost over -, Greek newspaper report that the Greek stock market announced losses of ~45 billions in the first three weeks of the year only! And the turmoil continues…
Yet still people wonder whether it’s time to announce the end of the bull market era. With all sincerity, I’d say yes. It’s about time. Global market indices have dropped 20%-25% from their recent high averages, in less than one month’s time! Now, you wouldn’t call that a bull market, would you?
Bull markets have two main characteristics:
- Investor confidence – as prices in the market are rising,
- and optimism – prices are expected to continue to rise.
Investors have lost their confidence long time ago, and that was beautifully illustrated in the queues outside Northern Rock, when they patiently waited to collect their life savings in order to… protect them themselves. But then government decided to save Northern Rock using public money.
Now, the government has decided differently. And through the mouth of the National statistician Alistair Darling, the Chancellor, announced that they will act knightly… So, how much will this noble gesture cost us? The total amount of public money that will go towards the rescue of Northern Rock, is the equivalent of loading every single family in Britain with Â£3,000 of debt!
Are you still dreaming of bull markets? Or bullfights?
- I am a financial services writer with experience in forex trading and stock market analysis.
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