Thursday 1 October 2015

We urgently need strong financial reports in October; otherwise the world economy may enter into a recession.

What are we still worrying about?

Trade volumes and stock prices stay low, showing the markets are still panicking. But what are the investors worrying about? Many people would say they worry about Chinese economy slowdown, the Fed's plan to raise rates, the Greece problem and so on. These answers are incorrect in my opinion. They are not news. Chinese economy slowdown could be foreseen last year. The Fed's plan to raise rates has been known since early this year. The Greece problem has been there since the Financial Crisis. Moreover, the oil price has returned to the previous level in early August. I think most investors are panic without knowing what is going wrong. However, because of the investors' panic, the firms are harder to raise money from the financial markets and this will affect the future income of the firms as well as the financial markets. Therefore, the financial reports due to be announced this month are important to the financial markets.  Strong reports can stimulate the financial markets and prevent a further fall in financial markets; otherwise, the financial markets will be dragged down and the whole world economy will have a danger to enter a recession.

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