By Kit Daniels
The Dow Jones Industrial Average fell 1,000 points on Monday amid a huge decline in Chinese stocks and a global sell-off.
The drop was the Dow’s biggest since 2008 and even though the index recovered some of the losses, the Dow was still down over 400 points as of late morning.
The Standard & Poor’s 500 index also fell into “correction territory,” meaning that it’s down 10% from a recent peak.
The global sell-off was triggered by growing concern over a slowdown in China and the Federal Reserve’s non-stop creation of money called “quantitative easing” which devalues the dollar.
“China’s stocks plunged the most since 2007 as government support measures failed to allay investor concerns that a slowdown in the world’s second-largest economy is deepening,” Kyoungwha Kim with Live Mint reported. “The Shanghai Composite Index tumbled 8.9% to 3,197.31 at 1:14 pm local time, erasing its gain for the year.”
“The Hang Seng China Enterprises Index lost 7.6%, poised for its biggest decline since 2008. Futures on the CSI 300 Index decline by the 10% daily limit.”
In response, U.S. Treasuries exploded as investors bought less risky assets to shield themselves from the turmoil.
Multiple financial experts, including Dr. Ron Paul and Peter Schiff, have warned of a coming financial crisis.
“We still have another stock market bubble and another housing bubble going on, but the big bubble I think is in the bond bubble,” he said on the Alex Jones Show. “It’s been going on for 35 years, taking interest rates from 21% down to actually negative.”