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If you’re just waking up, chances are you’re waking up to the news that you’ve lost money.
The Greece crisis is being likened to an economic Sarajevo. The markets are sinking faster than I can type. Asian stocks began tanking hours ago. (Last I checked, the Shanghai Composite Index was down 3.7%; the Nikkei 225 down 2.4%; Hang Seng down 2.7%; Sydney’s S&P ASX-200 down 2.3%; Seoul’s Kospi … well, you get the drift. By the time I hit “publish” these numbers are sure to be down further.) The European markets opened a few hours ago and … wow. Stampede city.
Yesterday, Puerto Rico — well, I’m sure you heard:
The governor of Puerto Rico has decided that the island cannot pay back more than $70 billion in debt, setting up an unprecedented financial crisis that could rock the municipal bond market and lead to higher borrowing costs for governments across the United States.
Puerto Rico’s move could roil financial markets already dealing with the turmoil of the renewed debt crisis in Greece. It also raises questions about the once-staid municipal bond market, which states and cities count on to pay upfront costs for public improvements such as roads, parks and hospitals.
For many years, those bonds were considered safe investments — but those assumptions have been shifting in recent years as a small but steady string of U.S. municipalities, including Detroit, as well as Stockton and Vallejo in California, have tumbled into bankruptcy.
Now, seems to me the world has exhausted its monetary ammunition, so what next? How bad is this going to get?
The sinking euro means I just got a raise, in effect; but this is clearly a short-term blessing. Not that I’m not counting my blessings. Believe me, I am. But obviously this personal rising tide won’t be enough to lift all boats — including mine, ultimately — so I’m not celebrating.
So, Ricochet, how’s the day going for you, financially?