All major indices show a fall of 4% to 5%.
The Dow and the Standard & Poor’s fell more than 4 percent, with Dow Jones Industrial Average down by 512 points, and S&P fell 60 points. Nasdaq lost more than 5 percent, falling a total of 136 points.
Everyone knows that fear of the unknown is usually worst than the actuality.
In this case, the fear of a possible double dip recession causes the US Stock Market Crash.
Since the US Stock Market Crash happens on a Thursday, the effect on the world would be a black Friday.
There is no way the stock markets of the world going up since Wall Street falls by the largest margin in one day since 2009.
A day before the great fall, I was just checking out the share price of Google, which was $601. Now, the share price of Google is just $577.
The usual trend is that when stock market crashes, the price of gold and silver increases.
In this case, we see a fall in precious metals as well.
Both gold and silver prices fall.
Gold has fallen to $1,645 while silver is below $40.
What happens? Since stock market and commodity market usually does not travel in the same direction, what causes the fall in gold and silver price.
The reason is the speculation.
Speculators bet heavily on margin, and they sell off to lock in profits. It is possible that they face margin calls in stock market, and they use the cash on speculating in gold and silver to meet margin calls in stock market.
Since US Stock Market Crash 2011 has happened, and there is no much good news about the US economy, the dip in gold and silver price is deemed as temporary.
The upward trend in gold and silver price per ounce will continue.
It will continue until the US economy recovers, and the country experiences nearly full employment.
That is still a long way in the future.
The question now is how bad the US stock market crash will affect the stock markets around the world.
The question is also how high gold price per Troy ounce and silver price per Troy ounce will go in the coming week.
The more bad news, the higher the price of precious metals.
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Lot of global tensions is going on at this time. Japan is expected to pull out its money from the global market as they want to revamp their country now. In current scenario anything can happen in the Share market Investors are advised not to panic and stay invested only safe traders and Stock Tips investors should exit their long positions on every high and one can use every decline as an opportunity to enter market again.
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