Global markets sputtered this morning in response to dismal economic reports from the Federal Reserve and the European company Markit, and things just got worse from there. By market close this afternoon U.S. stocks had fallen three percent and 10-year Treasury yields had dropped to to 1940s levels, according to The Wall Street Journal. The paper blames today's "global flight from risk" on the Federal Reserve's warning about another potential economic downturn in the U.S., weak manufacturing data from China, and "a lack of appreciable progress in containing Europe's debt crisis." Traders shrugged off slightly positive news like an improvement in U.S. jobless claims and an increase in the Conference Board's leading economic indicators. 

All this fear has translated into a lot of selling. "They're selling literally everything," trader Alan Valdes told the Journal today. "It's the realization that things aren't getting better that has traders concerned. They're selling gold, they're selling copper." Stephen Davies, chief executive of Javelin Wealth Management in Singapore, tells The New York Times that he blames the pessimistic outlook on one group: politicians. "It really comes down to political immaturity in both the U.S. and Europe," he explained. "The increasing chance of a U.S. recession and European implosion has shortened the odds of an overall second recession."