Assignment 5

Summary of story 1

Presented to: Dr. Mangla

From: Umair Islam

Section C BBA 3

Summary of story: “Stocks riding on a flood of liquidity: Risk is back on”

 There is continuous pumping of liquidity by central banks in US, Japan and European
Union which has made stocks go up shown by increase of 8.4% in DOW:DJHN 12.6% of
NASDAQ:COMP and S&P 500 is up by 9.5%.

 Federal Reserve said that special measures must be taken to reflate the economy by
increasing liquidity. This act as blessing for stocks, commodities and gold.

 This increasing liquidity is not a sign of recovery because their liquidity is artificial. So
the increase in this type of liquidity is good for the stocks but this increasing goodness
comes with increasing risks.