In Australia, the share market is taking a beating as Europe moves dangerously close to a recession. Also concerning is whether or not Italy has the ability to repay its worryingly high debts and this is a tough time for all involved. As well as these developments, the Australian dollar has sunk to its lowest point in a month,, going back to $US1.01. This is due to investors dropping risky assets that are linked to commodity prices. There have been heavy falls all on Wall Street and in Europe, meaning that the Australian share market has lost $31 billion in value.
Despite European leaders heading a 1 trillion-euro rescue fund, this has been the biggest fall in nearly two months. People who are interested in the state of affairs in markets and like to visit sites such as lovemoney.com to look for money-saving tips should take this as a warning that the markets are still very volatile and that care should still be taken. At the close, the statistics looked like this, the benchmark S&P/ASX200 index was down 102 points at 4,244.1 and the broader All Ordinaries index had fallen by 98.9 points at 4,307.3.
Italy is not fairing well, despite Prime Minister Silvio Berlusconi promising to resign. The markets do not have much faith that his country can repay its debt and Greece, Ireland and Portugal have all applied for a bailout. However, Greece owes much more than Italy and the markets are fast running out of patience. On Wall Street recently, the Dow Jones Industrial Average fell nearly 400 points with the rising of Italy's borrowing costs and talks in Greece collapsing. It seems that political leaders need to deliver on the commitments that they have made publicly, or else things will continue to spiral out of control.