News / Economy

US Stocks Dive; US, European Economies Shake Investors

Specialist Gregg Maloney works at his post on the floor of the New York Stock Exchange Thursday, Aug. 18, 2011
Specialist Gregg Maloney works at his post on the floor of the New York Stock Exchange Thursday, Aug. 18, 2011
TEXT SIZE - +
Bernard Shusman

Major stock indexes in the United States dropped sharply on Thursday.  

For many analysts, there are two main reasons for the market drop. One is the U.S. economy; the other is the European debt crisis.   

Jon Henes, a managing partner and financial expert at the New York-based law firm, Kirkland and Ellis, said a meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel this past week to address Europe's financial troubles was underwhelming.  

"We need to find a way to stabilize and capitalize the European banks before there is a monetary crisis. And then, on top of it, we’re looking at the U.S. and you’ve got inflation going up," said Henes. "You’ve got the housing market continuing to be in a depression and all the news coming out about housing is bad. You have the Philly [Philadelphia branch of the] Fed [Federal Reserve, or U.S. central bank,] report that came out today that was very weak. And as a result, you have people focused on what bad news there is in the economic world."

Henes said that because of the bad news, U.S. financial markets reacted negatively, causing what he called a crisis in confidence.

"What we’re seeing is Americans just not having confidence that our political leadership is going to get things done appropriately [not only] in the U.S., but also in Europe," said Henes.

Meanwhile, gold - traditionally considered a haven for investors - rose in price to more than $1,800 an ounce.  

Peter Cardillo, chief market analyst with Rockwell Global Capital, said soaring gold prices are due to several factors.

"One, continued central bank buying and, second, a total distrust in paper currencies. And so, obviously, investors are flocking to gold. And we will probably continue to see gold going higher."

Cardillo says gold might soon hit $2,000 an ounce. Cardillo also said he sees a slight recovery in the U.S. economy by year’s end.

Related video by Carolyn Weaver:

You May Like

Algerians Vote in Presidential Election

There were few media reports of protests and clashes around the country, but so far no significant violence More

Sharks More Evolved than Previously Thought

The discovery could “profoundly affect our understanding of evolutionary history” More

Pakistan Military Asked to Protect Polio Workers

Request comes as authorities say a Taliban ban on vaccinations in 2012 and deadly attacks on anti-polio teams have prevented thousands of children from getting inoculated More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Google Buys Drone Companyi
|| 0:00:00
...
 
🔇
X
George Putic
April 15, 2014
In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
Video

Video Ray Bonneville Sings the Blues and More on New CD

Singer/songwriter Ray Bonneville has released a new CD called “Easy Gone” with music that reflects his musical and personal journey from French-speaking Canada to his current home in Austin,Texas. The eclectic artist’s fan base extends from Texas to various parts of North America and Europe. VOA’s Greg Flakus reports from Austin.
Video

Video Millions Labor in Pakistan's Informal Economy

The World Bank says that in Pakistan, roughly 70 percent work in the so-called informal sector, a part of the economy that is unregulated and untaxed. VOA's Sharon Behn reports from Islamabad on how the informal sector impact's the Pakistani economy.
Video

Video Passover Celebrates Liberation from Bondage

Jewish people around the world are celebrating Passover, a commemoration of their liberation from slavery in Egypt more than 3,300 years ago. According to scripture, God helped the Jews, led by Moses, escape bondage in Egypt and cross the Red Sea into the desert. Zlatica Hoke reports that the story of the Jewish Exodus resonates with other people trying to escape slave-like conditions.
Video

Video Police Pursue Hate Crime Charges Against Kansas Shooting Suspect

Prosecutors are sifting through the evidence in the wake of Sunday’s shootings in a suburb of Kansas City, Missouri that left three people dead. A suspect in the shootings taken into custody is a white supremacist. As VOA’s Kane Farabaugh reports, he was well-known to law enforcement agencies and human rights groups alike.
Video

Video In Eastern Ukraine, Pro-unity Activists Emerge from Shadows

Amid the pro-Russian uprisings in eastern Ukraine, there is a large body of activists who support Ukrainian unity and reject Russian intervention. Their activities have remained largely underground, but they are preparing to take on their pro-Moscow opponents, as Henry Ridgwell reports from the eastern city of Donetsk.
Video

Video Basket Maker’s Skills Have World Reach

A prestigious craft show in the U.S. capital offers one-of-a-kind creations by more than 120 artists working in a variety of media. As VOA’s Julie Taboh reports from Washington, one artist lucky enough to be selected says sharing her skills with women overseas is just as significant.
Video

Video UN Report Urges Speedier Action to Avoid Climate Disaster

A new United Nations report says the world must switch from fossil fuels to cleaner energy sources to control the effects of climate change. The Intergovernmental Panel on Climate Change released the report (Sunday) following a meeting of scientists and government representatives in Berlin. The comprehensive review follows two recent IPCC reports that detail the certainty of climate change, its impacts and in this most recent report what to do about it. VOA’s Rosanne Skirble has the details.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.