Obviously if it keeps going down, that’s bad. But it looks like it’s at a support level and still much, much higher than it was 5 years ago. (Using SP500 as a proxy for the market at large)
In: Economics
It can have knock-on effects, but it is important to be able to cut through the noise and distinguish “this is very bad for rich people with readily-available media outlets” from “this is bad for the economy.”
The main risk here is a general paring down of lending as big wealthy investment groups lose a lot of money on loans they took out. That isn’t certain to happen, and a frustrating quality of finance is that financiers have little knowledge of, or interest in, their own role in systemic trends. So this could pose a serious risk to lending to everyone, which matters a lot. Or it could just mean some hedge funds go bankrupt, which hardly matters at all. But the market movements conjure this “coin flip,” if you will, into being. Thus the anxiety.
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