Het Neoliberale Geloof 22

'Global markets slide after China sell-off
By Nick Beams
28 February 2007

Global stock markets tumbled on Tuesday after a near 9 percent drop in the Chinese market—the biggest fall in a decade—sparked fears that a series of financial imbalances in the global economy could start to cause serious problems.
The global sell-off, which hit all major markets, culminated in a drop of more than 415 points on Wall Street or more than 3 percent. This was the biggest one-day decline since the markets re-opened after the September 11, 2001 terrorist attacks. At one point, the Dow was down by 545 points for the day, while two other key indexes, the Standard & Poor’s 500 and the Nasdaq Composite fell 3.5 percent and 3.9 percent respectively.
When trading opened on Wednesday, the Australian stockmarket, highly sensitive to economic developments in China, joined the global slide, falling by more than 3 percent and wiping off about $45 billion in stock values.
The immediate cause for the China slump appears to have been concerns that financial authorities were about to take action to curb speculation, including a lift in interest rates and a capital gains tax. The rumoured action has sparked fears that riskier financial trades and investments around the world could now be in danger.
“What we’re looking at here is a big move away from risk,” David Durrant, a currency analyst with a New York investment management firm, told Reuters. “The big fall in Chinese stocks especially has got some people nervous about the carry trade.”
The carry trade refers to the process in which financial investors borrow money in one currency at a low interest rate and then place it in high-risk assets in other markets. This process causes what are considered distortions in currency exchange rates. For example, while the Japanese currency should be strengthening because of increased economic growth, the carry trade has seen a fall in the value of the yen as investors transfer yen holdings elsewhere.
Large profits can be made from these transactions but they depend on market stability. Once that comes into question, with an event like the China sell-off, there can be a rush for the exits.'

Lees verder: http://www.wsws.org/articles/2007/feb2007/stoc-f28.shtml