All this talk of the debt crisis and contagion in Europe-
The way journalists are reporting the events (even in the FT and Economist) it's easy to panic. There aren't that many actual numbers being reported regularly- sure they tell you how many points the markets fell by, but how many people can tell you what the underlying numbers that lead to the panic are?
And also, of course the markets continue to fall, if they're going to convince anyone that reads the financial news at all that Europe's in grave danger.
It's a vicious cycle- they say the markets going to plummet, people read the news, panic and pull the money out, and markets plummet.
Then even more people are forced to pull their money out whether they believe the situation is unstable or not, because they're losing too much of it, and then this is used as an example of the lack of confidence people have in Europe being able to save itself- leading to further chaos.
I'm not saying that there's no cause to panic- clearly someone somewhere is going to have to pay for the debt eventually, no matter how many times they pass it around and restructure it.
But: the markets aren't magic, all they do is indicate what people think- and it would help if the papers didn't spook the public, helping cause the crisis.
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