Share and Follow
The Australian share market took its biggest hit in over a year on Monday, as fears grow that the US could enter a recession, limiting its buying power and creating global uncertainty.
Where did the money go?
“The decrease in the market value is not equivalent to cash. It’s essentially a decline in the market value of stocks that are listed on that particular exchange,” he said.
“There is also going to be people moving money from risky assets like the stock market, to safer assets like cash, gold and government bonds,” he said.
Source: SBS News
How does one market affect another?
Fluctuations in global markets drive the Aussie dollar up and down, which then affects price levels domestically.
How will the stock market fluctuations impact Australians?
“Since these subscriptions are compulsory, most Australians are now poorer.”
Source: SBS News
While institutional stock traders are bearing the brunt, he noted that everyday investors are also feeling the pinch.
However, those who sold shares in anticipation of a market crash are now in a better position.
Could more tariffs make things worse?
He told SBS News the uncertain economic policies, like threats of reciprocal tariffs or embargoes, could prompt countries and investors to avoid markets.
