Ben Bernanke

Bill Gross, the manager of the world's largest bond fund, has told investors selling treasuries they could be left disappointed if they overestimate the speed with which the Fed will wrap up QE.

The FTSE 100 has slumped 3%, gold has dropped 5% and gilt yields have spiked to their highest level in over a year as the prospect of an end to US QE rattles markets.

Markets across the globe tumbled overnight after the US Federal Reserve announced it may slow down asset purchases by the end of the year.

US markets followed shares across Europe higher overnight, while the dollar also surged, ahead of the latest Federal Reserve meeting in the States which may map out a QE exit strategy.

Japan's Nikkei 225 index has closed down 7.3% as comments from Federal Reserve chairman Ben Bernanke over a potential scaling back of quantitative easing spooked investors worldwide.

NEW WORLD

An ultra-bearish US hedge fund manager shorted gold a year ago, when it was still in favour with most investors, and thinks the price of the metal is on track for a multi-year drop.

Over the course of history, whenever governments have over-borrowed and become enmeshed in a debt trap, they have typically resorted to a process of financial repression as a means of redressing the problem.

Q4 2012 US GDP has been revised up from 0.1% to 0.4%, though the figure remains the lowest level of quarterly growth seen since Q1 2011.

Europe's leading equity markets took a beating yesterday as elections in Italy resulted in political deadlock.