Eurobond Debt Detonated The Crisis &Nbsp, The Ghost Of A New Financial Crisis Will Be Reproduced.

Investors are worried about the deterioration of the sovereign debt problem in Europe and the whole world. Economics Further slowing down, the 4 day New York stock market panic spread, the Dow Jones index closed down more than 500 points. At the close of the New York stock market, the Dow Jones Industrial Average Index of 30 industries fell 512.76 points over the previous trading day, closing at 11383.68 points, or 4.31%, the biggest decline since the financial crisis in 2008. The standard & Poor's 500 stock index fell 60.27 points to 1200.07 points, or 4.78%. The Nasdaq composite index fell 136.68 points to 2556.39 points, or 5.08%.

The main reason for the fall was the psychological panic of investors caused by the European debt crisis. It is reported that the European Union will help Italy and Spain, causing investors to worry about the deterioration of the European financial market prospects. At the same time, investors believe that the US's own economic recovery is also uncertain.

In terms of economic data, the US Department of labor announced on the same day that it was first received as of last week. Unemployment The number of relief is 400 thousand, which is the lowest in four months. The previous week's figure has been revised from the initial 398 thousand to 401 thousand. Recent economic data released by the United States, both from manufacturing index, consumer spending or employment indicators, are significantly lower than the average level of normal economic development, triggering investors' concerns about the economic outlook.

European debt detonating crisis

US debt fueled

"The reason for today's plunging by more than 90% is in Europe," said Joseph, a trader at Wall Street.

Recently, debt problems in Italy and Spain continue to ferment in the third and fourth largest economies in the euro area. The yields on Italy and Spain's 10 - year treasury bonds rose to 6.19% and 6.27% respectively. From the experience of three countries that have received assistance from Greece, Ireland and Portugal, once the yield of treasury bonds reaches 7%, external assistance will be required.

Berlusconi, Prime Minister of Italy, said that Italy has a solid economic foundation and can overcome the turmoil in the bond market. However, the market understands this statement from a negative angle. Investors believe that this statement is the same as before Greece, Ireland and Portugal. Once the country repeatedly claims that its credibility is good, it shows that it has no credibility.

Tyse, the European central bank governor, announced that it would restart the euro zone national debt purchase plan suspended in March this year. But Trichet refused to say whether the ECB was buying Italy and Spain bonds, causing investor panic.

Joseph said: "recently, Italy and Spain bonds. Rate of return We have climbed more than 6%. We can not believe that the ECB will continue to buy these two countries' bonds unless they are mad.

US debt fueled

The US debt ceiling has passed, but the solution has failed to resolve the market's worries about economic growth. In addition, the recent poor economic data released by the United States has exacerbated the pessimism of investors.

The panic also comes from investors' concerns about the slowing pace of economic recovery in the US. In the light of the recent economic data released by the United States, both the manufacturing index and consumer spending are significantly lower than the average level of normal economic development. Even if the economic data released on the same day on the 4 day are not bad, it can not alleviate the panic mentality of investors.

The US Labor Department announced the first time that the number of people receiving unemployment benefits was 400 thousand last week, the lowest level in 4 months. But investors generally believe that the single week value can not fully reflect the overall situation of the job market. At present, there is already a view in the market that the new round of financial crisis is coming, and there is also a saying that there is an economic recession.

Market's vote of no confidence in the government

The recent US debt ceiling problem and the European debt crisis continue to cause a lot of trouble, because the government's policymakers are not coping with it. Ronnie Ryan, an analyst at KWB, a research firm, said: "political leaders need to be prevented ahead of time, not the crisis."

Bloomberg's comments on 5 may suggest that the collapse is a vote of no confidence in the US and European governments.

Analysts believe that the reason why the European debt crisis once again ignite the confidence crisis is largely due to Trichet's latest statement highlighting the internal fragmentation of the European leadership. The European Central Bank has been opposed to debt restructuring in countries like Greece and other countries in crisis, and hopes that euro zone governments will shoulder more responsibility for rescue. The European central bank stopped buying Treasury bonds in March this year, and is also trying to kick the ball back to the government.

"Investors have already disarmed."

New York stock market has seen a rare slump in recent 4. "Crazy", "Disarm", "sell", "desperate" and "confused" are the most frequent keywords in the industry.

"Investors have already disarmed," said Peter Kenny, managing director of Knight capital of investment company. He believed that, from stock market to oil market, from spot to futures, no matter which market, which company or which trader, in addition to selling or selling.

When panic is out of control, people focus on the bond market. However, some traders said that the current high bond market bubble is probably no longer a safe haven for all kinds of funds that they want to take refuge in. Yang Sheng securities trading hall director Willis believes that as the bond market bubble high, I am afraid is no longer a safe haven.

In response to the global financial market turmoil, President Christina of Argentina called on 4 Latin American countries to make full preparations to prevent developed countries from passing the serious consequences of the financial crisis to emerging market countries including Latin America.

Is it a flopping or a new round of crisis?

In panic, people began to talk about the beginning of the bear market, worried that the decline would last for a long time.

Relative to the high point of the year, US stocks have fallen by 10%, but such a drop is not uncommon. Last summer, the bull market, which ran for more than a year, ended abruptly. The New York stock market fell 17% in two months. The reason is also the European debt crisis and the slowdown in the US recovery. But then it was discovered that the situation was not as bad as expected. The road of economic recovery in the United States is still in a state of stagnation despite its ups and down. Although the European debt crisis has been dragged on for a long time, it will not lead to the collapse of the euro. In order to stabilize the teetering financial market, the Fed launched the second round of quantitative easing monetary policy to lift the stock market from the bottom. In the end, the three major U.S. stock indexes rose more than 10% after repeated shocks, and at the end of last year, they returned to the level before the financial crisis.

The market seems to be replaying the plot of last summer? {page_break}

　　 Other major market performance

equity market

Germany -3.4%

French -3.9%, the lowest since July 2009

British -3.4%

Italy -5.2%

Brazil -5.7%

Argentina -6.01%, the biggest drop this year

Peru -5.57%

Japan -3.72%

Korea -3.70%

Hongkong -4.29%, the biggest decline since November 2009

Taipei -5.58%

crude oil

New York crude oil futures prices closed at $86.63 a barrel, -5.77%, the lowest in six months.

gold

New York Mercantile Exchange gold futures price, -0.4%

silver

New York Mercantile Exchange silver futures price, -5.6%.

Bond Market

Currencies

The yield of us 10 - year treasury bonds is -2.5%, the lowest since October 2010.

Currencies

US dollar to yen +2.7%

　 Global rise

Massive layoffs

Last month, although American manufacturing, medical, retail and other industries increased the number of employees, governments at all levels cut 37 thousand jobs.

Affected by the global economic recovery and the impact of the European debt crisis, from the financial sector to the telecommunications sector, the recent global wave of large-scale layoffs. In the second quarter, investment banking profits declined, including Goldman Sachs, Barclays, UBS, Credit Suisse and HSBC Holdings, which announced layoffs in the past week. Analysts believe that the direct cause of bank layoffs is to cut spending. Electronic communications and other enterprises also set off layoffs in the name of cost saving. NOKIA, SIEMENS, CISCO and other telecom equipment giants recently announced a drastic layoff plan. Japan's Panasonic Corp plans to lay off 35 thousand people worldwide in the next two years and become the largest number of layoffs this summer.

However, many multinational companies are planning to increase their business in China and other emerging market countries while announcing layoffs.

　 Chronicle of European debt crisis

In October 2009, Greece announced that the deficit would account for more than 12% of GDP.

Portugal and Spain lowered their credit rating in April 2010.

In May, Italy issued a fiscal tightening plan in 2010.

Ireland's debt situation worsened in September 2010, raising the second climax of the European debt crisis.

In July 2010, Germany introduced the austerity plan.

In July 2011, the EU summit draft showed that the time limit for the European financial stability agency was tentatively extended from 7.5 years to at least 15 years.

Memorabilia of US debt crisis

In May 2011, US Treasury bonds touched the upper limit of $14 trillion and 290 billion allowed by Congress. If the debt ceiling or spending cuts can not be raised in August 2nd, the default will not be able to repay principal and interest, bringing the international financial market into chaos.

Since June 2011, Obama and congressional leaders have held talks on raising the debt ceiling.

In July 31, 2011, the two parties in Congress reached a consensus on raising the debt ceiling.

In August 4, 2011, former US auditor general Warke said that the United States would be in Greece for 3 years and be in debt crisis.