Sell! Sell! Sell! The Market is Falling!
Posted on: Thu 8 Feb 2018
The market is falling! But there’s no need to panic. Despite the Dow Jones taking a recent dive, and the Australian market following suit, there has been a quick recovery.
Why was there such a big drop? What does this mean for future market stability?
‘The increase in bond yields is real, the increase in economic growth is real, but that growth appears to be accompanied by fears of an increase in inflation. And if inflation goes up, if bond yields go up, the cost of capital goes up for firms and so their value starts to come down,’ says Professor Stephen Taylor from the University of Technology Sydney.
Professor Taylor joins Tom Jordan.
Produced by Tom Jordan.
Image source: Public Domain Pictures