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View Full Version : U.S. pulls the plug on the world



mick silver
29th October 2008, 10:57
In the past week the financial crisis, which began in banking and spread to stocks, has careered into the currency markets. The U.S. actively decided back in September 2008 to shut down the investment banks that lend to the biggest professional investors. This has caused those investors to sell anything and everything and to settle their trades.

The result was a whirlwind of liquidation. Korean won, Turkish lira, Brazilian real, British pounds and commodities from oil and metals, all were sucked into the downdraft.

Like a speeding truck heading home, dollar investors left a vacuum in their wake, a vortex of dust, where there had been steadily growing emerging market economies.

And you thought the U.S. authorities were doing their best to prop up asset prices? As the economic lights go out and the U.S. administration fumbles in the dark, maybe it's accidentally cut off the hand that feeds it.

Or has it deliberately prompted a shakeout of asset values and a flight to the dollar? On October 3 the $US 700 billion bailout of banks' bad bets was signed into law, after U.S. Treasury Secretary Henry Paulson assured U.S. Congress it was the only way to avoid financial Armageddon. The stated aim was to support asset prices.

But on September 22, with
http://www.russiatoday.com/Crisis/news/32493

garydrumm
29th October 2008, 12:07
Excellent article. Thanks! :)