I can tell you there hasn’t been anything “fun” within the markets the last few days. Unfortunately, a lot of investors are on edge because of the recent (on-going) disaster in Japan. Much like the children’s song: http://www.youtube.com/watch?v=REftXTSgR8k&feature=related ; our global economy works the same. A blow to your knee could lead to more pressure on your ankle. In this situation, Japan is the knee and America is the ankle (more appropriately “cankle” as America is 50x the size of Japan). Investors are selling primarily due to fear that this disaster will slow down the global economy.
In fact, something interesting happened today. The Dow Jones Industrial Average fell almost 300 points at the opening bell. Due to this expected volatility, the New York Stock Exchange invoked “Rule 48”. According to Reuters, The exchange’s “Rule 48” gives it the ability to bypass price indication requirements that help determine the floor price at the open during regular sessions, speeding the beginning of trading.
This has happened in past years, so it’s nothing to focus on. Where most of our attention should be is in Japan. I’m a fan of disaster movies (Twister, Dante’s Peak, Armageddon) but this disaster is something Hollywood could never duplicate on a set. From what I’ve read, Japan was well prepared for any potential earthquake. No building structure or foundation was ever in question. The tsunami, however, is a different story. Pictures can explain the damage with greater detail than any words can, so below is a link of some pictures.
http://www.businessinsider.com/photos-day-after-japan-2011-3
After seeing the pictures most people should wonder what they can do to help. Unfortunately, at a time of weakness, others see opportunity. I’m sure a lot of scams will pop up asking for donations. Yahoo! has listed a few credible agencies currently helping with the rescue efforts.
