Yesterday’s wild ride on Wall Street is one of those incidents that is profoundly unnerving to the average investor. It is hard to believe that the Dow Jones Average sank more than 1000 points, from high to low, before rebounding somewhat. Weeks of slow gains were wiped out in the blink of an eye, for unknown reasons. And who knows what today will bring?
The news stories about the event have questioned whether there was some trading mistake, whether there was market manipulation, whether some robo-trading programs were inadvertently triggered, or whether someone actually hacked into the New York Stock Exchange. Anything is possible, I suppose, but I think the more likely scenario is that investors are extremely skittish — and they have a lot to be skittish about. The Greek debt crisis continues to be a huge problem, other debt-ridden EU countries may not be far behind, and their more solvent EU partners may be balking at more bailouts. In America, after months of bland assurances that the economy is on the upswing, we aren’t seeing much real job growth or signs of significantly stronger economic activity. In the meantime, America seems to be piling up its own debt at an astonishing pace, as if the country were bidding to outdo Greece. With this kind of national and international context, is it any wonder that markets are jittery?
Webner House 