Is This the Age of Interdependence?

Allison Kade
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Is this the age of interdependence?

Unlike generations past, we live in a world of by-the-minute economic news and electronic trading around the world. The speed of information has made everything from our food supply to the global stock market more intertwined than ever before.

This week, the stock market was up on Thursday, following a surprisingly good report on the housing sector, demonstrating how quickly housing news affects the market. And, as we’ve seen from the recent recession’s influence on home-buying patterns—vice versa.

Another intermingling: Chinese trade outlook is worsening for this year, and this week its Commerce Ministry pointed to problems in Europe as a big culprit, since Europe is China’s biggest international market.

Then we have what we’ll call the “Wal-Mart indicator”: The giant conglomerate’s revenue increased 4.5% in the second quarter, but its chief financial officer noted that high gas prices may be why sales aren’t even better, showing how one economic factor can have far-reaching effects.

Even Facebook’s fate is entwined with outside factors. The technical glitches on the Nasdaq during its IPO got it off to a rocky start, its sales have been suffering and now its stock sank to a record low on Thursday.

Today, we’ll talk about what Mitt Romney’s appointment of Paul Ryan could mean for you, and why so many investors are more pessimistic than ever—and how it could actually be good for your long-term investing prospects.

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