August 17, 2007

IPO Market Update

Last month’s decline in equities is now a full-fledged correction. Underlying it was the excess liquidity of the past years that has just suddenly dried up. The crisis in liquidity has spread through the world’s markets, fueling fears of economic slowdown. It has also caused the big corrections we saw in currencies and commodities, most notably in oil and gold. Small capitalization stocks, including many recent IPOs, were also swept by the mighty flow of fear that gripped Wall Street and the markets.

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