“Global Market” means the supply and demand of everything globally.
When a movie is made the creators rely on box office returns from around the world, if a movie bombs here it could still be profitable if other countries like it and DVD sales are popular.
That is one easy to explain example but food, oil, technology, building materials and countless other commodities are sold around the world. The health of an American company is just as tied to the economic ability of Asians and Europeans to consume their products/services as American consumers.
If one Nation enters a depression, their population has very little disposable income to consume. That means the entire world that produces now has less demand for its products and more competition in countries that are healthy enough to buy.
This means production will decrease everywhere where stuff is made.
This means people are laid off.
Laid off people have less disposable income so demand shrinks again.
This means nations not originally in recession will now start receding.
This domino effect continues until something occurs that increases disposable income to inspire growth.
Liberals think printing money and spending it (Stimulus spending) will achieve this kickstart and instigate a reversal, this does not work because nobody has confidence in an artificial, temporary cash flow and without consumer confidence disposable income is not seen as “disposable”.
Innovation and expansion inspire economic reversals, either by new things that create much demand or new supplies of things already in high demand.
Innovation requires the Liberty of the populace to pursue their dreams (low regulation environment) and reasonable enough tax rates on capital gains to get those with “paper equity” to risk liquidating their assets to invest in new ideas.
Banks don’t fund “innovation”, banks fund known and verifiable structures. Private money fuels research and development of new ideas and skittish investors do not pay confiscatory taxes to liquidate solid investments on an unknown new idea when consumer confidence is low and the State is going bankrupt.
The “Stock Market” is an entirely seperate animal from the “Global Market”, the Stock Market will thrive regardless of the global market because the Stock Market is the quickest to adjust to global realities.
If Apple sells fewer I-pads next year then Apples stock will fall in value as it misses it projected sales mark, but if Apple then reduces production (saving cost’s) and then lowers its sales projection accordingly so that it beats its estimate the next quarter, Apple stock will rise again.
Any company can maintain a profit margin so stocks recover quickly in most cases.
If the stocks are rising because the world is in a healthy growing economic cycle then we all do well, if the stocks are rising because a company closed 30 percent of its production facilities but only lost 25 percent of its sales then it sucks for everyone other than the stockholders.
America is the number one consumer nation, when we stumble the whole world follows.
The two things we need to reverse this cycle are never discussed because they are taboo.
- Innovation, we stifle innovation by blocking individuals from starting businesses do to massive regulation and expense.
- Capitalizing on an under-served demand for commodities. Oil, Timber, Iron Ore, Coal and Natural Gas are all plentiful in the United States and in large demand worldwide, we stifle and cripple all efforts to serve this market.
The only two things that can legitimately ignite an economic reversal are rarely discussed and when they are they are deemed “OUT OF THE QUESTION!” by our leaders and special interest groups.
If I am right in assuming you were confusing the “Stock/Investment Market” with the “Global Market” then that should shed some light on it, you are right in saying “then who should care about the market” if you were referring to the “Stock Market” because the Stock Market will take care of itself regardless. Just make sure your 401k is not overly invested in “growth” stocks.
The “Global Market” however is of vital importance to everyone breathing even though most have no idea why.