World Markets Meltdown : And the time to bet on opportunity cost

World Markets Meltdown : And the time to bet on opportunity cost


Nikkei : -0.32%
HangSeng : -1.44%
Sensex : -2.60%
Nifty : -2.60%
FTSE : -2.62%
CAC : -3.41%
DAX : -3.35%
Dow Jones : 
Nasdaq :
MCX Gold(5 Dec Fut) : -0.83%
MCX Silver(5 Dec Fut) : -2.27%




Major resistance for Dow Jones Industrial Average is at 12200.

U.S. stocks were sharply lower by the close of European trading following media reports that a Congressional supercommittee has failed to agree on a plan to cut at least $1.2 trillion from the U.S. deficit over 10 years.

U.S. is facing a debt problem, not so much in the near term but in the years to come when an aging population will combine with the most expensive per-capita health care in the world — more than double that of France! — to send the federal deficit skyrocketing.

The euro-zone debt crisis was also in the spotlight. Moody’s Investors Service warned that rising French government borrowing costs and a wobbly economic outlook threaten the country’s AAA-rating outlook.

Rising French government borrowing costs and an uncertain economic outlook continue to pose a threat to the outlook for France's AAA credit rating, Moody's Investors Service said Monday. According to Alexander Kockerbeck, senior credit officer, the elevated borrowing costs persisting for an extended period would amplify the fiscal challenge the French government faces amid a deteriorating growth outlook, with negative credit implications.At the same time, the U.S. economy is still crawling, hemmed in by the debt overhang from the housing bubble crash and that subsequent Great Recession. So to simply take a knife to spending or jack up taxes risks not just sending the economy into a tailspin but potentially making the deficit problem even worse, because of the cost of unemployment benefits and other payouts that are triggered when the economy turns down.