Depending on who you talk to, one might think we are starring the bottom of the barrel of the stock market from a long way up.  Those that have been around for more than thirty years have trimmed their holdings to prepare for the greatest discount sale of equities that this world has ever seen.  It is the newbies that are hurt the most, because they were the last ones to jump in.  The warning bells have been ringing for a good six months, but only the veteran investors would know this.  Now you can see how the global economy is so intertwined and how a mega-consumer of commodities like China was ten years ago can affect economies of developing countries when it slows it’s importing of the raw materials they export.  Lack of demand softens the price of that commodity and producers start cutting back on production, workers are let go, wages and tax revenues shrink, governments’ burden of welfare grows if they are stable enough to have social safety nets.  Developing and developed countries alike are affected, but in different ways.  Those that extol the virtues of a “free market” economy expect the various stock markets to continue their slide downward over the next year or so, because much of the “froth” was sustained by cheap money, ala QE in various forms by the different(and intimately connected) Central Banks of the G20 countries.

The Piper piped, now it’s time to Pay!

Hope your powder is dry,

MAC