Edgy stock markets are a sign of changing fortunes
Published 21/06/2013 | 04:20
Another day, another perverse reaction by stock markets to news. This time it was the turn of the US to throw a spanner in the works of jumpy stock markets across the world when its central bank – the Federal Reserve, or Fed if you're still hankering after the three-lettered acronyms such as CIA and FBI which accompanied the G8's visit – spoke.
Its chairman Ben Bernanke, the equivalent of our governor Mervyn King, or soon-to-be-Mark Carney, said the US economy is looking in pretty good shape.
You might think such news would be music to the ears of stock market bulls from here to Boston and would send equities rocketing but the reality was something different.
Spooked by the prospect of a slowdown in the pace of monetary injections – quantitative easing to give it its scientific name – traders sold shares like they were going out of fashion, sending markets plummeting. This volatile reaction to seemingly good news is something which is a regular occurrence and, for the optimistic, should be seen as a sign that things on the up.
Obviously any signs of renewed prosperity in the US or Asia doesn't immediately filter down to us.
The Northern Ireland economy is still struggling through a pretty tough time, the growing number of exporters from these shores means we are gradually cutting the lag time between ourselves and overseas markets and hopefully that will narrow further in the coming years.
Conferences like those highlighted to the left of this column should go some way to doing that and it is encouraging that a region with such potential as India is being targeted.
So while the action of stock markets thousands of miles away may seem irrelevant, the truth is they are worth keeping an eye on for an insight into our own economic destiny.