In this article we will cover what has become an obviously global bear market this year. In several countries, the share and bond markets are lowering, and the recent crisis in the US economy has added sauce to this problem. In the beginning of 2008, the Wall Street Journal experts indicate a global bear market.
In several larger countries, like the United States, Japan, China, and Russia, 7 trillion dollars has been lost in shareholder value. The present volatility in the global financial market makes the situation difficult for many investors and they are feeling uneasy while building portfolios.
In Japan, three central banks have cut down the rate of Yen. A traditional bear market initiates with a period of enthusiasm. Then a slow down starts from one part of the market and after this, the losses gradually affects both the strong and weak companies.
The housing market in US has also gone down. House sales have decreased a lot and home builders’ shares have declined by nearly 50%. This is not a good sign for the global property market either. In addition, the recent dollar sell-off has created more problems in the US bond market.
The Dow Jones Transportation Average, bank-stock indexes and the Russell 2000 small-stock index have already decreased by over 20% than that of the previous year. The benchmark indexes in Taiwan, Switzerland and Chile also have gone down.
On January 27, the NASDAQ Composite Index decreased by 2.04%. The Dow Jones Industrial Average decreased by 15.5% compared to the previous year’s record. In China and India, the share market condition is getting worse.
So it is clearly understood that a global bear market is knocking on the door, therefore the investors are changing their plans accordingly.