You will have been hard pressed to have avoided stories
of an apparent ‘imploding’ of stock markets over the last 10 days. It’s a
negative story so our media jump all over it.
Yes there have been some volatile days that have
seen some stock markets fall by over 4% in a day’s trading……including the
largest economies across the world. But what our ‘doom addicted’ media have
failed to explain, is the positive long term reason that sparked the sell off.
The first Friday of each month is a big deal for
investment analysts and investment markets as it is when the US announce their
latest job data. Positive data that shows unemployment reducing and wage growth
increasing is seen as a positive indicator that the world’s largest economy has
the right ingredients to grow (and vice versa). The most recent job data
announcement was good……but investment analysts and investment markets thought
it was too good!
The concerns are that the Fed / Bank of England et
al will need to raise interest rates quickly and significantly to stop a
potential inflation issue. Increasing interest rates then hinders business
growth as the cost of servicing debt is more……stunting growth as a consequence.
The long and short of it is this……Trump’s tax cuts
for businesses seem to have had the desired impact he wanted. More people are
employed and wage growth is increasing.
Surely, our media can see the long term benefits of
this rather than scaremongering on the back of very short term investment
market volatility?
When did it become so unfashionable to report
something good?
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