Brokers in the spanish stocks’ market
Some people say that disasters use to happen on Thurdays… this one has come to support that theory.
Months (if not years) ago some people started saying that the market was going to correct itself sooner or later because of the housing bubble, but that the process would be slow, and non-painful. Some people said there was not such kind of bubble. Now even the words of the people that warned about the bubble seem optimistic… There was a bubble, yes? But the problem were not only the houses, it was ignoring the risks associated to lending money.
Stock markets today are simply busting, and this is a chain reaction. Stocks that lose value have been the trend for the last week in worldwide markets, and today the worst things have happened… a sudden burst. All European Markets have lost around 3%. Asian have lost a lot too… and same for American markets.
And when ALL markets lose… that’s bad, pretty bad. Because the most basic way to protect capital doesn’t work: diversification. Everyone says to control risks by diversifying when investing… but if every stock market is going down, then how much you have diversified doesn’t matter… you go down will the market. If everything goes down, then money (that unreal thing) literally disappears.
What will happen after then? Nothing good. Even if markets recover from this, there will be effects from the vast amounts of capital that banks have been injecting into the market. Expect raising inflation, in the best case.
Months ago some people started to speak about deflation, recession because of the risky behaviours when investing… it’s hard to listen to them when the noise of the cash is too loud… Now it’s time to gather what we’ve been growing up for years.
Market is down! Go bears!