Wall Street set to follow global sell-off

NF Reporter · 10-06-2008, 08:50 AM

AP - Financial markets around the world had a rocky start Monday after European governments took steps to limit the damage from the growing global financial crisis. U.S. stocks appeared headed for a steep drop at the opening, and the credit markets remained under strain.

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mkt711 · 10-06-2008, 07:16 PM

Uh oh.....

waltky · 10-08-2008, 01:12 AM

Global financial crisis to tear EU apart?...

European Union Tested By World Economic Crisis
Oct. 7, 2008 - Financial Crisis Is A Test For European Union - And Its Survival

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Wall Street's woes extend far beyond Main Street and all the way to Law Street - the hulking headquarters of the European Union. But the 27-nation bloc based at Rue de la Loi in Brussels, Belgium, hasn't taken sweeping joint action to deal with the global financial meltdown. Instead, it's essentially left member countries to go it alone with a patchwork of measures aimed at keeping banks afloat. Frustrated investors want to know why, and some have begun to question whether the EU - at its core, an economic union - will survive. Although the EU pledged to act as one to calm roiled markets, it hasn't done much beyond a move Tuesday to boost guarantees on savings accounts.

That's led member states to take an a la carte approach, with major economic powerhouses like Britain and Germany putting together rescue packages, leaving smaller nations like Iceland to take the fall. It's a risky business for the EU: In the short term, banks in poorer countries may flounder and fail. And by relinquishing key decisions to its members just as they're turning to EU headquarters for guidance at a time of crisis, the bloc could see decades of attempts to forge unity simply disintegrate. Already, the 27 EU nations are divided over deploying troops to Afghanistan and deadlocked on a constitution designed to transform their union into a political super-state. Only 15 countries now use the common euro currency and the pride of the bloc _ passport-free travel _ doesn't apply to the entire EU.

Failure to pull together now on the financial crisis could push member nations even further apart, perhaps emboldening a resurgent Russia's influence on the fringes of the enlarged EU. "Europe is in the midst of a once-in-a-lifetime crisis," 256 of the continent's leading economists said Tuesday in an open letter to EU leaders. "Unless European leaders immediately unite to address this crisis before it spirals out of control, they may find themselves fighting over how best to salvage the aftermath," the economists said. They evoked "the dark years of the 1930s," adding: "It is not an exaggeration to say that it could happen again if governments fail to act." And failure to act in unison has been an EU hallmark over the past few years.

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waltky · 10-17-2008, 01:16 AM

Das Kapital makin' a comeback...

Global crisis sends east Germans flocking to Marx
Thu Oct 16, 2008 - Two decades after the Berlin Wall fell, communism's founding father Karl Marx is back in vogue in eastern Germany -- thanks to the global financial crisis.

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His 1867 critical analysis of capitalism, "Das Kapital," has risen from the publishing graveyard to become an improbable best-seller for academic publisher Karl-Dietz-Verlag. "Everyone thought there would never ever again be any demand for 'Das Kapital'," managing director Joern Schuetrumpf told Reuters after selling 1,500 copies so far this year, triple the number sold in all of 2007 and a 100-fold increase since 1990.

"Even bankers and managers are now reading 'Das Kapital' to try to understand what they've been doing to us. Marx is definitely 'in' right now," Schuetrumpf said. The revival of Marx's treatise reflects a broader rejection of capitalism by many in eastern Germany, a communist country until 1989 and now racked by high unemployment and poverty.

A month of intense financial turmoil has toppled banks in the United States and forced a series of government bailouts in Germany and elsewhere, reinforcing anti-capitalist sentiment. Chancellor Angela Merkel -- herself an easterner -- unveiled a 500 billion euro financial rescue package this week, a move decried as a reward for irresponsible bankers.

More Global crisis sends east Germans flocking to Marx | International | Reuters

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Recession looms despite global interventions
Thu Oct 16, 2008 - Government steps to shore up the banking system and unfreeze credit markets showed some signs of progress on Thursday, but grim news from major economies reinforced fears of recession and hammered global markets.

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U.S. stocks bucked the global trend to end higher, clawing back some of Wednesday's steep losses despite news of layoffs in the auto-industry, a slowdown in industrial production and more warnings about the state of the economy. Banks, which are at the heart of the crisis, were in the spotlight again.

Switzerland's top two banks, UBS AG and Credit Suisse Group AG (CS), took emergency measures to shore up their finances. In the United States Merrill Lynch and Citigroup reported heavy losses on bad loans and tough-to-sell mortgage securities. In a sign of easing strains in the credit markets, rates that banks charge each other for loans mostly fell in response to radical moves by central banks to provide liquidity, bolster banks and loosen credit lines to institutions needing cash.

However, U.S. financial institutions borrowed record amounts of cash from the Federal Reserve in the latest week, according to Fed data released on Thursday, indicating that credit conditions in the United States remain constrained. European Union leaders vowed to shield their industries from the global crisis and pushed plans for a global summit to overhaul the world financial system.

More Recession looms despite global interventions | U.S. | Reuters