Saturday, July 15, 2006
Bonddad On Last Week's Economic News
Short Version: Bad. (As in "Not good".)
Ironically, in March, Japanese stock forecasters were predicting rises no less than 10%, and one brave soul predicted a 70% rise. They were bullish for the first time in a long time. But Asian markets, including Japan, have had perhaps even worse performance than the US market, down very roughly 15% since March, while the S&P (INX) is down only about 7%.
I find this fascinating. The saying was that "When the US sneezes, the rest of the world catches cold. But now we have four major economies (US, EU, and Japan; China if one measures by purchasing power parity) with more in the making. At some point, the rest of the world has to decouple from the US economy. But at the moment, the prospects of global recession are significant.
More blogs about politics.