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Generational Dynamics Web Log for 19-Aug-2011
19-Aug-11 World View -- Global markets plunge on bad economic news

Web Log - August, 2011

19-Aug-11 World View -- Global markets plunge on bad economic news

Israel strikes Gaza targets, after terrorist attack on southern Israel

This morning's key headlines from GenerationalDynamics.com.

Israel strikes Gaza targets, after terrorist attack on southern Israel

The Sinai is the easternmost region of Egypt, along the border with Israel

The Sinai is the easternmost region of Egypt, along the border with Israel

As we reported yesterday, Egypt's Sinai region has become almost completely lawless since the pro-democracy protests began in January, and the new government withdrew all its security forces from Sinai. Egypt has recently been returning its army to the Sinai, but not soon enough. On Thursday, terrorists, thought to have come from the Gaza Strip, killed at least eight Israelis and wounded as many as 40 others in multiple coordinated attacks on public buses and private cars just north of the Red Sea tourist town of Eilat. Two of the dead were reported as a four year old and a six year old. A Hamas official said that Hamas was not behind the attacks, but he praised the attacks anyway. Israel Project

The Israeli military carried out air strikes over the Gaza Strip, targeting those it blamed for a series of deadly attacks in southern Israel. At least six people, including a senior militant, were killed in the air strikes. BBC

West Urges Syria's Assad to Step Down

The United States, European Union and other world powers are calling for the resignation of Syrian President Bashar al-Assad because of his continued bloody massacre of innocent civilians. However, I did not hear or read one person who claimed that this action would cause Assad to do anything different. Turkey did not participate in the announcement. The U.S. already has economic sanctions in place for Syria, and the Europeans plan to push for Syrian sanctions in the United Nations Security Council. VOA

Karachi Pakistan in a daze after another 30 killed in ethnic violence

Funeral of three people killed on Thursday (PPI)

Funeral of three people killed on Thursday (PPI)

The port city of Karachi, Pakistan, is in a state of constant fear after two days of ethnic violence in which 50 people were killed. In at least 21 cases, a person was kidnapped, tortured for several hours, killed with multiple gunshots, stuffed into a gunny bag, and dumped at a random place. Dawn (Karachi)

Banks fear a new credit freeze

When the "credit crunch" began late in 2007, it meant that it had become impossible for one bank to lend money to another (See my 2007 article, "Markets fall as torrents of CDO exposures bolster fears of new credit crunch.") Now, the burgeoning European credit crisis is motivating the Fed to scrutinize the assets of European banks with offices in the U.S. This has caused concerns among bankers that this will trigger a new credit crunch like the one in 2007. Reuters

Analysts stunned by freefall of Philadelphia Fed factory index

The Philadelphia Fed's business outlook survey index fell to -30.7 in August from +3.2 in July. A positive index indicates growth, and analysts were expecting a reading of +0.5. Instead, the enormous decline stunned analysts, and indicated a rapidly weakening economy. Another early look at manufacturing in August, the New York Fed’s Empire State manufacturing survey, was also weak. The survey fell to a reading of negative 7.7, the third straight negative monthly reading. MarketWatch

Previously occupied home sales fall unexpectedly

The number of people who bought previously occupied homes fell in July for the third time in four months. This year is on pace to be the worst in 14 years for home sales, as more Americans worry that the economy could slip back into another recession. Home sales fell 3.5 percent last month to a seasonally adjusted annual rate of 4.67 million homes, the National Association of Realtors said Thursday. That's far below the 6 million that economists say must be sold to sustain a healthy housing market. Associated Press

Wall Street stocks fall 4-5% after a slew of bad economic news

Many commentators were "shocked" by Thursday's stock market plunge of 4-5% for Wall Street stocks, and some blamed a note from Morgan Stanley saying that the U.S. and Europe "dangerously close to recession" because of unsatisfactory responses from policymakers. As I've explained in the past, analysts had been predicting a huge recovery in last half of this year, including vastly bloated earnings predictions. A recession would mean that the bloated earnings predictions are wrong, and that stock valuations are much higher than usual, meaning that stock prices are high, and it's time to sell. The Morgan Stanley report was followed by a slew of bad economic news, including a negative Philadelphia Fed manufacturing report, and a fall in home sales. Stocks also fell sharply in Europe. The Street

From the point of view of Generational Dynamics, a full-fledged panic and crash is coming with certainty, either now or before too long. This is being debated in the Generational Dynamics forum.

Asian stocks sink on fears of U.S. recession

As of this writing on Thursday evening (Friday morning in Asia), stock markets in Asia open sharply lower amid signs of a possible U.S. recession and renewed worries over the financial health of Europe's banks. Also Wall Street futures are sharply lower, suggesting a lower opening on Friday morning. AP

Georgetown basketball exhibition game in China ends in brawl

Basketball brawl

Basketball brawl

What began as a goodwill trip to China for the Georgetown men’s basketball team turned violent Thursday night when its exhibition game against a Chinese professional club deteriorated into a benches-clearing melee in which players exchanged blows, chairs were thrown and spectators tossed full water bottles at Hoyas players and coaches as they headed to the locker room. The American team returned to the locker room with 9 minutes 32 seconds left in the game and the scored tied at 64 after a chaotic scene in which members of the Georgetown and Bayi Military Rockets teams began swinging wildly and tackling one another. Washington Post

(Comments: For reader comments, questions and discussion, see the 19-Aug-11 World View -- Global markets plunge on bad economic news thread of the Generational Dynamics forum. Comments may be posted anonymously.) (19-Aug-2011) Permanent Link
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Generational Dynamics Web Log for 19-Aug-2011 19-Aug-11 World View -- Global markets plunge on bad economic news

Israel strikes Gaza targets, after terrorist attack on southern Israel

West Urges Syria's Assad to Step Down

Karachi Pakistan in a daze after another 30 killed in ethnic violence

Banks fear a new credit freeze

Analysts stunned by freefall of Philadelphia Fed factory index

Previously occupied home sales fall unexpectedly

Wall Street stocks fall 4-5% after a slew of bad economic news

Asian stocks sink on fears of U.S. recession

Georgetown basketball exhibition game in China ends in brawl

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Generational Dynamics Web Log for 19-Aug-2011
19-Aug-11 World View -- Global markets plunge on bad economic news