Wednesday, October 8, 2008


Iceland - This volcanic island near the Arctic Circle is on the brink of becoming the first "national bankruptcy" of the global financial meltdown. (Landsbanki - Iceland Bank)

Now they are watching helplessly as their economy implodes — their currency losing almost half its value, and their heavily exposed banks collapsing under the weight of debts incurred by lending in the boom times.

Everything is closed. They couldn't sell their stock or take money from the bank since Tuesday.

The Nikkei average plunged 9.4 percent (-952.58 points) on Wednesday, its biggest drop since the 1987 stock market crash, as growing fears of a global recession led investors to wipe $250 billion off the value of Tokyo shares. Investors were dumping their shares and no one wants to buy even if stocks are valued cheaply.

The Paris stock exchange briefly suspended calculating the benchmark CAC-40 index on Wednesday amid a massive influx of sell orders that caused it to plummet nearly 8.2 percent. Orders passed a threshold of 35 percent of the total market value of the 40 blue-chip stocks that make up the index, triggering an automatic halt in the calculation under exchange rules.

Moscow's MICEX stock exchange, where most of Russia's trading takes place, announced it is shutting until Friday after opening with steep losses.

The MICEX index dropped more than 14 percent in the first half-hour of trading Wednesday. The RTS exchange, whose index is widely considered the benchmark of Russia's markets, fell more than 11 percent in the first 30 minutes and suspended trading until further notice.

Americans' retirement plans have lost as much as USD 2 trillion in the past 15 months — about 20 percent of their value.

Many central banks around the world are reducing their key interest rate to help stabilize the world financial market. For me this is just a temporary measure only.

The Federal Reserve, acting in coordination with other global central banking authorities, cut a key U.S. interest rate by half a percentage point Wednesday to steady a teetering economy.

The Fed reduced its key rate from 2 percent to 1.5 percent.

In Europe, which also has been hard hit by the financial crisis, the Bank of England cut its rate by half a point to 4.5 percent, while the European Central Bank sliced its rate to 3.75 percent.

Other central banks also taking part include the banks of Canada, Sweden, and Switzerland.

China also cut its key interest rates Wednesday for a second time in less than one month to stimulate slowing economic growth amid the global credit crisis.

What would happen next ? Everything is still in the earlier stage...... I don't dare to think about it. The worst is not over yet. Today Malaysia political matters is not a big issue anymore if we want to compare what really happen in the global financial market. Be prepare for the worst to come............


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