While markets rallied initially this morning, they tailed off towards the end of the day as fears of a global slowdown eroded confidence. I think China’s decision to cut interest rates is very significant and I believe that it is the first of several more cuts to come. Europe is in a severe recession that is only going to get worse before it gets better. China must revitalize growth to reduce the impact of the developed economies buying less goods from Chinese manufacturers. It will be essential over the next 5 years for China to increase consumer spending so that it is less reliant on exports.
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