The Market Does Not Crawl; It Jumps

Dimitris N. Chorafas

Chapter 7 in Household Finance, 2013, pp 155-176 from Palgrave Macmillan

Abstract: Abstract Chapter 6 brought to the reader’s attention investment principles and policies which help to manage the household’s wealth better. These have largely been tactical issues to be supplemented by knowledge and appreciation of market dynamics — the subject of this chapter. Factors underpinning the way the market behaves divide into two main groups. First, there are those whose after-effect is widely apparent. Examples are the stock market earthquakes of 2000, 2008–9 (in the wake of the Lehman’s bankruptcy) and the equity-wise negative investment year of 2011. With only one exception, in 2011 all stock market indices sank worldwide. In continental Europe, Italy’s MIB/S&P went down 25 per cent; France’s CAC40 17.8 per cent, and Germany’s DAX 15 per cent. In Asia the Shanghai index was down 22 per cent, nearly Italy’s level, even if China is a creditor nation and Italy is debt-ridden to the tune of €2.1 trillion ($2.73 trillion). Only New York’s Dow Jones went up in 2011.

Keywords: Real Estate; Central Bank; House Price; Hedge Fund; Household Wealth (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:pal:pmschp:978-1-137-29945-1_7

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DOI: 10.1057/9781137299451_7

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