tagged w/ Global Economic Crisis
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Markets around the world hammered by credit crunch as governments move to secure bank deposits.
Markets were thrashed again on Monday, as the US credit crisis spreads worldwide. The Dow Jones lost another 370 points and closing at under 10,000 for the first time since October 2004. At one point the Dow was down 800 pts. But managed to recoup half. The day started with reaction to sharp declines in Asian and European markets. Tokyo's Nikkei index fell to its lowest level in four and a half years, sinking 4.25 percent. Hong Kong's Hang Seng index lost 4.3 percent. Markets in China, Australia, South Korea, India, Singapore and Thailand also fell sharply. In Europe the trading was halted twice in Russia with the market closing down 19.1 percent, the DAX in Frankfurt, Germany was down 7.1 percent, while the FTSE 100 index in the UK was down 7.9 percent. Stocks in Paris took a big hit losing 9 percent. Across the Atlantic Brazil lost 5.5 percent; Argentina was off 5.9 percent, while Mexico's index fell 5.4 percent, In Canada the TSX was down 5.3 percent. Faltering confidence in the financial system following a series of bank bailouts forced many European governments to offer deposit guarantees. Expectations are that the US Federal Reserve, the European Central Bank will have a coordinated interest rate cut as early as Monday, the first joint action since the September 11, 2001, attacks on the US.Markets around the world hammered by credit crunch as governments move to secure bank... more
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Leo Panitch: US state plays role of defending global financial system, it had to act in this crisis.
After President Bush signed the controversial bailout bill into law, Senior Editor Paul Jay talked with Leo Panitch to get his analysis of the situation. Leo said it is irresponsible to suggest that the government should have let these banks fail, ultimately advocating for the full nationalization of the troubled banks. Leo then explains the significance of the US treasury bill as the base upon which everything else in the global financial system is valued, as well as explaining the US government's role as the guarantor of the t-bill's value. Finally, Leo criticizes the dominant paradigm that states and markets are separate and opposing forces in the modern capitalist system.
Leo Panitch is the Canada Research Chair in Comparative Political Economy and a Distinguished Research Professor of Political Science at York University in Toronto. Panitch is also the author of "Global Capitalism and American Empire" and his most recent release "American Empire and the Political Economy of International Finance".
See Part 2 at: http://current.com/items/89382669_the_financial_crisis_and_the_real_economy
See Part 3 at: http://current.com/items/89386959_the_financial_crisis_at_the_local_level
Leo Panitch: US state plays role of defending global financial system, it had to act... more
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