It's Been A Long Time Since Anybody Panicked About Anything

Hungary Riot

Last night we told you that you had to start paying attention to the Hungarian Forint again. It turns out that maybe you don’t.

As Felix Salmon rightly points out, the broader markets are not reacting in the slightest manner to news that an IMF bailout of the non-eurozone country had fallen through. This is surely good news, as it means markets aren’t inclined to panic at the first mention of rain.

And it’s not just Hungary. There was no panic after last week’s downgrade of Portugal, or this morning’s downgrade of Ireland.

There is skittishness, and nervousness. The markets sold off hard on Friday, but it would appear that markets are reacting negatively to actual disappointing economic news (disappointing revenue growth), and this is not panic. This is rational.

So, all of our attention now, it would seem, turns to the “double dip” question which is not a fun thing to contemplate, but it also doesn’t spell imminent explosion of the powder keg.

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