Wednesday, 9 May 2012

FTSE falls amidst European political disharmony

FTSE 100 @ 5554.55, -100.51 (-1.78%)
DJIA @ 12932.09, -76.44 (-0.59%) at close after recovering from session lows of 12820 and below.

Markets took a tumble yesterday following Wall Street's opening although to be fair the source is clearly European with the Union threatening to unravel with Greece and France leading the way with political uncertainty and news from Spain that the country has had to bail out its 3rd largest bank to the tune of Eu8bn.

With France's new President looking set to rebel against the recent budgetary pact signed by his predecessor (and thereby dissolving the Franco German direction that has kept the Euro going thus far), there could yet be more inflationary fuel thrown onto the still burning pyre that was the credit crunch in the search for the illusion of inflationary growth to diminish debts.

Alternatively, with lessening consensus it might isolate and test Germany's resolve to maintain the Euro raising the possibility of the Eurobond.

And Greece does once again look set to degenerate into chaos which could yet be the fuse that starts the dominoes falling.

Its always been the case but it is still concerning that politicians can often get themselves elected by telling the majority of voters what they want to hear rather than exercising true leadership by telling voters what needs to be done then winning over hearts and minds to a shared vision.
Reality only bites once elected at which point politicians often only seem to realise their personal career ambitions rather than the raised hopes of voters.

All clearly unsettling and uncertain with the apparent fate of Europe at stake and yet more contagion fallout.

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