Panic sets in (Headlines from the Meltdown)

Global economic crisis ‘serious’: IMF chief – Associated Press, Jan. 21, 2007

The head of the International Monetary Fund called the global economic situation “serious” and said markets worldwide had responded skeptically to a U.S. stimulus plan.

Dominique Strauss-Kahn stressed that a U.S. recession would affect economies across the globe.

“The situation is … serious,” said Strauss-Kahn following a meeting in Paris with French President Nicolas Sarkozy. “All the countries in the world are suffering from a slowdown in growth in the United States.”

* * * * *

Fullblown Panic – James Howard Kunstler, Jan. 21

A whole closet full of “other shoes” is now waiting to be dropped. Surely the biggest clodhoppers in the closet belong to the hedge funds, representing trillions and trillions of dollar-denominated “positions” which, however hallucinatory, had previously yielded enough real “money” year-by-year to keep all the realtors and Humvee dealers in the Hamptons goose-stepping to Goldman Sachs’s drumbeat. These “positions” can’t help now from moving into counterparty crisis territory, especially as the bond insurers such as MBIA and Ambac go up in a vapor, and if that happens the damage could be so colossal globally that Stephen Hawking might have to be brought in to run the Federal Reserve.

This is going to be a rough week. Fastening your seat belts may not be enough for this ride. Better superglue yourselves to the floorboards and pray for God’s mercy.

* * * * *

Wall Street set to plunge – CNNMoney.com, Jan. 22

Wall Street looked set to join the global market rout early Tuesday, as the threat of a U.S. recession battered sentiment worldwide.

At 7:48 a.m. ET, futures were indicating a disastrous start. Dow futures were down 4.5 percent while S&P futures lost 5 percent. Such a decline would mark the sharpest drop at the open for U.S. stocks since the first session following the Sept. 11 terrorist attacks.

“It’s going to be a very rough ride this morning for U.S. equities,” said Art Hogan, chief market analyst at Jefferies & Co.

* * * * *

Hong Kong Index Plunges 8.7% – Yahoo! Finance, Jan. 22

Hong Kong Index Plunges 8.7 Percent Amid Second Day of Global Sell-Off

Hong Kong shares plunged Tuesday, with the benchmark index tumbling as investors dumped shares on fears a U.S. recession will spark a global slowdown.

The Hang Seng Index dropped 2,061.23 points, or 8.7 percent, to 21,757.63. That’s the most points the blue chip index ever lost in a single day, but just shy of the 8.8 percent it plummeted after the Sept. 11 attacks on the U.S. in 2001.

….Markets across Asia fell sharply on Tuesday for a second straight day amid investor pessimism over the U.S. government’s stimulus plan to prevent a recession. China’s benchmark Shanghai Composite Index fell 7.2 percent, and Japan’s Nikkei dropped 5.7 percent to a two-year low.

“You can see investors have lost confidence in the U.S. government’s ability to handle the subprime situation,” said Pang with Sun Hung Kai.

* * * * *

Bank of America net sinks 95 percent – Yahoo! Finance, Jan. 22

Bank of America Corp, the second-largest U.S. bank, said on Tuesday fourth-quarter profit sank 95 percent, hurt by more than $7 billion of losses tied to poor trading decisions and mounting credit woes.

…. It was the latest in a series of earnings declines among the largest U.S. banks as the nation’s housing crisis and a slowing economy lead to a growing number of consumers falling behind on their bills.

About Matt Cardin

Teeming Brain founder and editor Matt Cardin is the author of DARK AWAKENINGS, DIVINATIONS OF THE DEEP, A COURSE IN DEMONIC CREATIVITY: A WRITER’S GUIDE TO THE INNER GENIUS, and the forthcoming TO ROUSE LEVIATHAN. He is also the editor of BORN TO FEAR: INTERVIEWS WITH THOMAS LIGOTTI and the academic encyclopedias MUMMIES AROUND THE WORLD, GHOSTS, SPIRITS, AND PSYCHICS: THE PARANORMAL FROM ALCHEMY TO ZOMBIES, and HORROR LITERATURE THROUGH HISTORY.

Posted on January 22, 2008, in Economy and tagged . Bookmark the permalink. Leave a Comment.

Leave a Reply

Your email address will not be published. Required fields are marked *