Investors walking on thin ice
October 21, 2015
The recent craziness in the stock market has investors trembling with uncertainty. Many believe stocks are overvalued and could cause a tremendous market correction.
“The biggest driver of volatility is a drop in the market and uncertainty,” Economics teacher Julie Youngblood said.
People are afraid to make moves in the market due to the uncertainty that has built up around the stock market’s stability.
“You don’t know what’s going to happen, it’s like when you’re running and you don’t know what’s around the corner, so you slow down,” AP Macroeconomics teacher Carlos Valverde said.
All nations economies are intertwined, the Chinese and Greek markets played a factor in the stock’s unpredictability all summer.
“I don’t think anybody is really independent nowadays, there are lot of wealthy investors in those two, especially China, who own parts of the U.S. or who have bought our debts,” Valverde said.
The predominant emotion that runs the market at the moment is extreme fear as reported by CNN Money’s Fear and Greed Index. Experts have pitched in to make sense out of the haze that the market is going through.
“The public is walking into a trap again as they did in 2007,” billionaire Carl Icahn said on a national broadcast to The Sovereign Investor, Sept. 9.
Some recommend keeping a cool head and not making any reactive decisions.
“No panicking when prices start to fall because you haven’t lost any money until you sell your stock,” Valverde said.
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