Panic and fear are horrible things when seen in the raw. Ugly, basic human emotions and when overlain by money and greed, it’s even uglier, as we saw on Wall Street this morning where short sellers had a field day in the last hour of trading, and here and in Asia where markets took their lead from the US and sold, sold, sold.

But it must be said that for every punter and supposedly long term investor selling and heading for the exist, there’s someone buying, and so it was on Wall Street, though in many cases it was the short covering themselves to complete the profitable deal.

With shorting banned, it didn’t matter.

The lemmings assembled at 10am and proceeded to run right over the cliff. The market here fell by almost 8% (around 336 points), taking the value of the ASX 200 stocks below $A1 trillion and the amount wiped off the overall market to around $A600 billion this year (all off our super and the fortunes of the likes of James Packer, twiggy Forest and Frank Lowy!)

It was bloody as the market saw the steepest falls in what is already a rotten year. Just after Midday the selling pressure has eased a touch and the market was trading just under 6% or around 250 points.

In Tokyo it was a more miserable story: a 9.9% plunge in early trading on top of that 9.8% drop on Wednesday.

Our market might be off 14% for the week by midday today. Tokyo’s is off closer to 20% (which is a correction and a new bear market in itself).

The previous biggest fall was on January 22 when the market dropped by 7.1%. We were under that just after noon, but there’s four hours of trading to go and Hong Kong, China and other Asian markets to start trading.

The dollar was back well under 70 US cents at the devil’s number 66.66 cents at 12.15pm, oil was down to $US84, copper was off a sharp 7% at $US2.23 a pound and gold was up $US43 an ounce at $US929 an ounce in Asian trading.

And the Reserve Bank is maintaining to keep markets well cashed up. It added $2.63 billion into the system this morning in its daily operations.

That was well above the system deficit estimated at $1.84 billion. The banks maintained cash balances at the RBA overnight Wednesday of $8.4 billion, down around $1 billion on the level a few nights earlier in the week.

But apart from the gains by gold, the only other gainer around the world seems to be a special prayer for these times from the Church of England in the UK.

London media reports said that the Church of England’s website is carrying a “Prayer for the Current Financial Situation” which has been been viewed nearly 8000 times since it was published online in September, that lifted traffic to the “prayers for today” section of the website by 28% — Is Gold long or short today?.

Peter Fray

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