We Still Got It!

Fears that the world economy has uncoupled from the US and that we aren't the biggest game in town anymore may prove to be unfounded, says the NY Times:

Stocks Plunge Worldwide on Fears of a U.S. Recession

some highlights:

"The sell-off was evenly distributed from East to West, with indexes plunging in London, Paris, Frankfurt, Tokyo, Hong Kong, Seoul and Bombay. The Frankfurt Stock Exchange’s Dax index plummeted 7.2 percent, its steepest one-day decline since Sept. 11, 2001. The 7.4 percent drop in Bombay’s Sensex index was the second-worst single-day tumble in its history.

Stocks followed suit when markets opened in the Western Hemisphere. Canadian stocks closed down 4.75 percent, and a key market index in Brazil was off 6.6 percent.

In Japan, which may be facing a new recession of its own, most indexes were off by more than 3 percent on Monday and were down another 4 percent in early trading on Tuesday.

Those jitters extended to fast-growing markets, like China, and those, like India, that are thought to be relatively insulated from the United States. Shanghai’s Composite Index closed down 5.1 percent, while Hong Kong’s Hang Seng fell 5.5 percent, also the most since Sept. 11, 2001."

Some thoughts:

(1) there goes the REST of my portfolio

(2) so much for de-coupling

(3) will the ECB be able to stick to their "no rate cuts" policy? will we get a natural experiment between accomodation (Bernanke) and toughness (Trichet)?