Welcome to the wonderful world of the Stock Market Circus!
Come and see: Here you will find a world of thrills and spills. With wild beasts that will make you shudder with their roars and claws, illusionists that will leave you speechless with magical tricks, tightrope walkers and contortionists with inhuman postures, window dressers who will free themselves from impossible traps and, of course, clowns who will make us laugh out loud.
Only a few sessions. Cannot be extended.
After enjoying the show (some children are terrified of it), let's talk about the economy. On the reflections that are taking place and the conclusions that analysts will reach in the next few days in the Forum for Davos.
This year's forum is more timely than ever and aims to «improving the state of the world«. The Swiss professor Klaus Schwab was the forerunner of these meetings, which originally discussed business strategies, and has become the true World Economic Forum.
Some very interesting ideas have been contrasted among its attendees, here are some examples:
The mission of the EDFIntervention and rate policy decisions are not intended to save the markets from an economic downturn. Crack, but to save the economy. Many people often confuse one thing with the other. It is like not distinguishing sex from love, although they are related, we all know that it is very dangerous to confuse them.
Another very interesting reflection that is being discussed at Davos is the real recession (rather than technical) that the economy in general seems to already be in. The big unknown is how deep it is and how many countries will be affected. Once the intensity and scope of the crisis has been determined, it will be time to worry about how long it will last, but that will come later.
The EDF, The Federal Reserve, as we have seen, is taking the emergency measures that the instruction manual of the economy requires: significant rate cuts, while at the same time helping the hardest hit sectors with economic and fiscal measures, in addition to those that we will see in the near future. The Federal Reserve has rolled up its sleeves and is bailing water while activating the emergency protocol.
Europe's neighbouring ship is watching from a distance. Far from checking the safety of its own ship and fearing the waves that would be caused by the sinking of the American liner, it continues to proclaim that it will not tolerate inflation and threatens rate hikes. It is not only Trichet but also the rest of the European leaders, deny the recession. As if denial itself were enough to bail out the water. They deny the real estate affectation having in their cellars bubbles like the Spanish and the Irish. The ECB will soon have to resort to the emergency instruction manual. recessive, But it seems clear that he will do so late and badly. It does not yet seem ready to roll up your sleeves as the EDF, But water is not reduced by talking, it is reduced by acting.
Davos is so timely that perhaps it will open your eyes European authorities to stop thinking about the stock market circus and focus on the real problems of the global economy. If they don't, the circus will leave the big top and take to the streets of the city. And the contortionists, tightrope walkers, illusionists, wild beasts and clowns will cease to be a spectacle and become a nightmare. surreal.
Come and see, but we will always have the following Davos.