These last few months, the worldwide economy has been suffering from a major crisis, better yet, the worst crisis we’ve known since 1939. All around the globe, stock markets have now reached several depth points, as also the Dow Jones Industrial Average, which has reached a 12-year low, closing at 7114.78 points. The last time the stock index closed below that level was May 7, 1997.
Despite the US government’s assurances of last Monday, which stood ready to back the financial system, the Dow Jones plunged 250 points. Of course now they want to know how the banking system would get stabilized.
CNBC has reported earlier that AIG, the tottering and mostly government-owned insurance giant, would announce losses of nearly $60 billion. That would represent the biggest loss in US corporate history. This also weighs a lot on the markets, which costs it many points.
AIG said it would release financial results “in the near future”, but that seemed to be all talks. They said they will continue to work with the US government to evaluate potential new alternatives for addressing AIG’s financial challenges.
While we keep wondering how all this has gotten this far, all of the markets worldwide seem to be going down on the same hill. A steady market as the Dow Jones Industrial Average is one that people assume to be reliable. Unfortunately they have been proven wrong: the Down Jones traders seem to be out of touch with the economy.
Even though the brand new American economic system that President Barack Obama promised to his country is full praised, numbers that the markets are showing today don’t seem to be in proportion with the Presidents promises.
Source: http://features.csmonitor.com/economyrebuild/2009/02/23/dow-plunges-to-a-nearly-12-year-low/
Written by Tom Baeyens,
Student at Artevelde College
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