Australia’s stock market took a jab to the nose yesterday, suffering its largest one-day fall since September 2001.

The market nosebleed turned into a $42.9 billion gusher (au$50 billion) as it shed more than 3 percent of its value in a matter of hours.

International analysts blamed a news release from Macquarie Bank, Australia’s most successful investment bank, for starting the dominos falling. The bank stated that it faced big losses on two of its investment funds relating to the U.S. subprime mortgage market. Shares in Macquarie fell more than 10 percent on the news; some analysts worry that Macquarie could become the next Enron.

But Sydney wasn’t the only stock exchange to get battered. Punch-drunk bourses from Mumbai to Hong Kong to Tokyo reeled for the second time is six days on Wednesday.

Hong Kong lost 3.15 percent, South Korea tumbled 3.97 percent, and Tokyo fell 2.19 percent. Singapore lost 3.27 percent. After the Asian mauling, European markets also opened lower.

“The stock market correction is turning out to be more serious than expected. We may take longer to recover from this … blow,” said Phillip Securities managing director Loh Hoon Sun (Straits Times, August 2).

Though some international stock indexes may be near highs, they are increasingly volatile, and analysts say the recent instability gets back to the United States. Bad loans and risky investments with high leverage in America’s mortgage industry have started a chain reaction of reduced credit, tightening lending standards and corporate failures, which is spilling over into world markets.

The Trumpet warned subscribers two years ago that the housing bubble would lead to big trouble. Now that trouble has spread from the U.S. to global stock markets. Recent stock market action indicates that the consequences of a bursting housing bubble are about to be felt.