Stock Market Crash 2008 - 2009 - 2010

Stock Market crash of 2008 / 2009 leading investors to Gold

Stock Market crash worries are leading investors to interesting places to keep their money. Since before the 2008 stock market crash, gold has been exploding. We also find that money has been flowing in to both India and China since the collapse of the US Stock Market. For information on places other than the crashing US Stock Market, visit our research on Gold and the Indian Rupee.
New news and no stop to the Stock Market Crash of 2009. Did we think the market would stop crashing as 2008 came to an end? Be sure that 2009 may be worse for the market than 2008. Is that possible?
You better believe it. The Stock Market Crash 2009 is very real.
One of the most underestimated events in modern financial history is about to happen. With no rate cut today from the Federal Reserve. AIG will fail, this will cause the biggest leg-down yet in the current 2008 Stock Market Crash.

CNBC on the No Action Fed. 2008 Stock Market Crash

The Federal Reserve, meeting during an unprecedented crisis on Wall Street, decided to leave interest rates unchanged but expressed concern about the crisis escalating.


The Fed's action to keep rates at 2% was a disappointment to investors, who were hoping that recent turmoil in financial markets would prompt the central bank to resume cutting interest rates. The Fed's action to keep rates at 2% was a disappointment to investors, who were hoping that recent turmoil in financial markets would prompt the central bank to resume cutting interest rates. In its statement, the Fed said "strains in financial markets have increased significantly and labor markets have weakened further." However, the central bank said it also remained concerned about inflation pressures......No mention of the eminant failure of AIG, which will effect financial institutions around the world. This is sure to cause the Global Stock Market Crash of 2008

Bank Failures, continued bad news....No end in site to the market crash of 2008

Notice that each holiday brings us closer to the Great Stock Market Crash of 2008. It's been a very strange year in the stock market. Look back at the 2008 calendar as the stock market crashes, month after month.
A brilliant professor writes about the myths and Reality of the upcoming
2008 Stock Market Crash
Is a Collapse in the Cards?
Will the market crash continue in 2010? This is the trillion dollar question
By Jeremy Siegel on TradeOurMarkets.com

As I write this, stocks around the world are falling, the U.S. Federal Reserve is madly cutting interest rates to try to head off a recession, and everyone is worried about a global economic slowdown. Worries of a coming Stock Market Crash are all over the news. All this uncertainty was spawned by plunging U.S. home prices and the crash of the subprime debt market, which has blown up into an international credit crisis. What caused this fiasco, who is to blame and what it means for investors has been the subject of much debate. Here are the myths and realities:

Myth: The crisis resembles the one that hit the U.S. savings and loan industry two decades ago, necessitating a multibillion-dollar government bailout.
Reality: The current situation is very different from the savings and loan debacle of the 1980s. Back then, lenders used government-insured deposits to make risky investments with the full knowledge that if those investments failed, the government would have to make good on the depositors' balances. In the current crisis, the financial institutions are absorbing all the losses and no government bailout is planned.

Myth: The blame for the bubble in the housing market and pending Stock Market Crash rests with former U.S. Federal Reserve Chairman Alan Greenspan, who kept interest rates too low for too long.

Reality: While it certainly can be argued that Greenspan mismanaged short-term interest rates, that was not the major cause of the bubble. Soaring home prices were a worldwide phenomenon driven by demographics and low long-term interest rates, which were caused by low inflation and the huge buildup of savings in Asia. In fact many countries completely outside the dollar sphere, such as the U.K. and Spain, experienced an even greater real estate bubble than the U.S.

Myth: Because the current slowdown is due to the sharp cutback in the willingness of financial firms to lend, central banks can do little to improve the situation and stop the pending Stock Market Crash.
Reality: Central banks can and have done much to stabilize credit markets. The crisis was marked by a sharp increase in interest rates on bank lending over the targeted cost of funds set by central banks. Partly by injecting reserves into the market, central banks have ensured there is sufficient liquidity and reduced the "risk premium" attached to loans. The London Interbank Offered Rate (LIBOR), the peg for trillions of dollars of bank loans, has fallen from 5.75% last August to just over 3% today because of actions by the U.S. Federal Reserve. These declines have eased the anxiety in the credit markets. 2008 Stock Market Crash - Dow Jones, Nasdaq, S&P



Myth: Since almost all stock markets went up and down in unison during this crisis, international diversification is no longer an effective strategy for investors.

Reality: Although it is true that in the very short run stock markets have become increasingly correlated, there is no evidence that over longer time periods correlations between markets have increased. The speed of international communications means that traders instantly transmit both fear and euphoria across global markets, leading to similar day-to-day volatility. But longer-term movements depend on economic and profit trends within each country. Since more than half of the world's equity capital is now headquartered outside the U.S., maintaining a diversified international portfolio is as important as ever.

Myth: Most of the decline in the prices of financial stocks can be explained by the huge write-offs of mortgage-backed debt.

Reality: The decline in financial stocks far exceeds even the most bearish estimates of loan losses from mortgage-backed securities. From May 2007 to its recent low in January, financial stocks in the S&P 500 Index have declined by more than 35%, erasing more than $1 trillion in market capitalization. The market value of financial stocks headquartered outside the U.S. have also declined substantially. These losses far exceed the worst-case scenario of $200 billion in mortgage write-downs.

The only possible rationale for these huge price declines is that investors believe an economic downturn will significantly impair other assets of the banking industry and there will be a permanent decline in income from lending. The truth is that banks have greater access to central-bank liquidity now than before the crisis and will likely recapture some of the lending that has been lost over past years to the asset-backed commercial-paper markets.

Certainly over the past few years there was much foolish lending that had led to severe losses, and the economy will suffer in the short run. But actions by central banks will assure that this credit crisis does not morph into a full-blown recession or worse. And in the long run, saner lending and more reasonable home prices will lead to a stronger economic recovery.