Business

Global Financial Troubles Worsen. Meeting Planned in Washington.

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The global economic troubles worsened today as major markets around the world have fallen 6-10%. The situation has deteriorated to the point that the world’s financial ministers and central bankers will meet in Washington this weekend in an attempt to coordinate a global response.

Unfortunately, no one really knows what will calm global markets. On the heels of the United States’ $700 billion bailout package, countries from Japan to Britain to China to Iceland have made serious steps to shore up their nation’s banking system by infusing money into the system and/or cutting rates to encourage lending. So far, stock markets have shrugged off such maneuvers and continue to fall.

I keep hearing references to the Great Depression. And while I am nervous about the current situation, I also know our nation and most other nations are taking steps never even considered in 1929 and the early 1930’s. We have likely already reached or will soon reach the natural bottom of this market correction – any greater declines will be panic based. So, the key is to stop the panic before it snowballs.

Hopefully, this weekend’s meeting in Washington will come up with ways to do just that.