Asian stock markets plummeted in early trade today as stocks in Europe and America fell off a cliff. Result from Wall Street was especially bad as the Dow Jones Industrial Average fell 4.3% (512 points) and the Nasdaq dropped over 5% in overnight trades.
What is the main reason for this severe drop? You can thank the politicians in Washington. The recent nonsensical debt ceiling debate showed the world a divided government in the U.S. and this eroded hope that the American government can pull together to help the world economy. In the wake of that debacle, traders have lost all confidence in the markets and are now selling everything.
Now there are some people who believe this is the start of a new global recession, a new "double-dip." With the Dow losing more than 1,300 points (10.5 %) in just 2 weeks, that is a scenario that seems more likely by the day.