Asian markets join global freefall

Asian markets took a battering, as Nikkei stocks opened down 2 percent, hitting its lowest level in five months. Markets in China, Japan and Korea also took a steep nosedive.

­It follows a day when US commodity stocks fell as the Dow Jones Industrial average plunged by more than 4 percent.

World markets have been rocked since the US was stripped of its AAA credit rating earlier this month. Across the Atlantic, French and German leaders tried to shore up their ailing economy with a set of proposals which included the creation of a European government. But so far, the markets have failed to react favorably.

Patrick Minford, a professor of applied economics at Cardiff Business School, says the markets are still concerned about growth.

“There’s been inflation in the world economy, and there’s been quite a tightening of monetary policy around the world, especially in China and India and some of the other emerging markets,” he told RT. “And this led to a fall back in growth in those countries and elsewhere. The markets are worrying about the slow growth.”

“What is happening,” he continued, “is that the Western economies, the richer economies, are having a harder time of it. All the growth and availability of raw materials is being taking by countries like China, India and Brazil, thus leaving very little scope for the richer countries to grow. And they are groaning under these very high oil prices, which depress their incomes and make them much more cautious.”

“We just have to grin and bear it, just keep up going through this crisis,” he stated. “The euro-zone will take time to sort itself out. Either the euro will break up, or they will produce a fiscal union with big transfers to bail out all these countries – nobody really knows which. But that won’t be resolved anytime soon.”

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