“global economy is veering ever more closely to the edge of the cliff with every swerve, left or right, down or up” – In 10 trading days stock market drops almost 20%, - Monday drops 6% and Tuesday recovers 4%. Uncertainty and volatility is the current trend. A one day recovery is not an indication of a rebound. You will recall our caution from Sunday (August 7, 2011) evening’s blog/article: “The first wave will pass with some damage, but it is the second that you have to keep your eyes on – which will indicate whether another move downward, a recession, in the global economy is upon us.” (READ - diplomaticallyincorrect.org/films/blog_post/coordinated-g-7-action-signals-fear-drama-in-financial-markets-by-ambassador-mo/33414 Rumor/Fact Du –Jour: The second wave is now coming. Tuesday’s (August 9, 2011) global equity dramatic turnaround rally was presumably sparked by the US Federal Reserve’s explicitly stating that it would not raise rates for 2 years, signaling “cheap money” for the economy but also financial markets and speculation for that time frame. The drop this Wednesday (August 10, 2011) seems to be based upon concerns of a new round of Eurozone debt concerns and the impact – contagion such could have on European based banks – more specifically France and French banks. High Frequency Trading & Predatory Capitalism: Hard to discern the fundamentals from speculation, fact from rumor. However, rumor frequently becomes a self-fulfilling policy and speculation has no shame in employing any tool when billions and trillions of gains and losses are at risk on the table that financial markets have become. Is it gambling or shrewd financial analysis and moves? Difficult to discern always; however, the US stock market moved almost 10% in a matter of an hour. Most market veterans agree that this was in large part driven by “computer trading” or “high frequency trading” which only accentuates the herd mentality – be the first in and the first out and do not get run over by the herd. (Read our ARTICLE – “Financial Jungle – Can Anyone Leash the Predator?” diplomaticallyincorrect.org/films/blog_post/financial-jungle-can-anyone-leash-the-predator-by-ambassador-mo/27281 ) Swerving on Edge of Cliff: It is a dangerous period still for the global economy and particularly small investors. This is the environment where predatory behavior in the markets is most prevalent and can operate under the cover of various real and rumored stories and dramatic swings, (PHOTO Hyena as Predatory Capitalism. However, besides retirement accounts and life savings in balance, so will go the trend of the global economy in one of these huge swings. However, it is noteworthy that regardless of gains or losses in the financial markets, the wild swings and uncertainty are contrary to stability and reestablishing healthy markets decisive for global economic wellbeing. It is not the same if at the close of the day or week, the wild swings in the financial markets even out. More swerving veers the global economy downward – global economy is veering ever more closely to the edge of the cliff with every swerve, left or right, down or up. More Related Reports at “International Financial Crisis Channel” - diplomaticallyincorrect.org/c/international-financial-crisis















 By Ambassador Muhamed Sacirbey














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