Bear Market: The Number One Threat To The World

So far, this is illustration from The Economist is the best picture of bear market that we’ve seen. In the accompanying article about our current markets, they review some basic bear market stats:

The American stockmarket had its worst month since 2002 in June and is now down more than 20% from its peak, the definition of a bear market. It is not alone. According to Standard & Poor’s, a rating agency, the value of global stockmarkets fell by $3 trillion during the month, thanks in particular to a 10% decline in emerging markets.

And then they go on to say that the credit crunch is going to get worse:

Investors might have coped with the credit crunch if it were not for the high commodity prices, and vice versa. They do not know whether to fear inflation or recession more, but they know that both at once will be unpleasant. It looks like a lengthy period of gloom is in store for the stockmarkets. Meanwhile, the best investors can do is hope, Micawber-like, that something will turn up. A collapse in oil prices would help.