6 Comments

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  rajakumar at 08:33 AM JST - 13th October

  Russia massive reserves which total 598 billion USD. Some 4 billion Euros will loaned to Iceland banks by Russia.

  Iceland banks major lender are EU finances . If Iceland defaults on loan the it will drag EU and Russia down too. Russia reserves bailing out and helping out in EU. Bailouts also mean russia now becomes a major lender too in Iceland banks but also collect interest on its loans like EU.

  US government should start doing something like Russia with its reserves to stop its dow jones fall. If the dow is helped out of its instability then global economy goes back to stability.

  Even the Federal reserve collapsed in USA in past history and they were bailed by rich banks of in EU who still collect interest from the Federal reserve. The Federal reserve does not belong to USA government,it had been denationalised via EU banks bailouts in the past.

  I don't know how today's economic powerhouse will stop the drag down, but they should lend and collect interest .

  This does not mean there will not be future confidence loss in the global economic system. Global economic systems dynamics need constant and never ending improvements for future and should discard old outdated systems for better future.

  All Powerhouses of economy like Russia,China,India,IMF,World bank,Federal Reserve and many others should help to stabilise the economic drag down and get their cut via interest from their loans.

  Just some views from me for criticism by JT readers.

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  some14some at 09:30 AM JST - 13th October

  Just some views from me for criticism by JT readers.

  No criticism no compliments, your comments if not heard by markets will surely be heard by church goers !

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  Farmboy at 09:52 AM JST - 13th October

  So if the banks are taken over with the idea of promoting liquidity, but liquidity does not return, wouldn't the government, and therefore the US taxpayers, wind up holding not only worthless mortgages but also worthless bank stock, and in that way never get a positive return on their money? If so, this is basically the government forcing the people to make a poor investment. Why not force us to buy technology stocks? It seems like a better investment than banks.

  Of course, it may work, and liquidity will be restored. Then we'll just have to deal with the coming depression. Nice.

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  SezWho2 at 04:44 PM JST - 13th October

  “This is bigger than the private sector can fix by itself,” said James A Baker III....

  Maybe so. However, Thomas Friedman argues (in today's International Herald Tribune) that the only thing that can fix this is the economy healing itself. Spreading money around will have some effect, but it will not be a fix.

  He has a point. The only time that the market is ever real is when it is valued at liquidation value. The Dow never does that. It doesn't even value at going concern value. It values at a fantasy value that is the aggregate of human expectations. Friedman says that the market is now reevaluating expectations.

  Government money may help to shore up expectations, may even result in their stabilization at values similar to those before the latest fall. It would be wrong, though, to think that this fixed any fundamental problems.

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  adaydream at 06:35 AM JST - 14th October

  The fundamental problems stemed from deregulation, a flawed mortgage system, speculation and credit default swaps.

  This problem was created from Main St all the way to Wall Street. It was created by those so busy acquiring greedy profits and turning a blind eye to what they were causing that by the time they saw what was happening they didn't care. They just took their profits and ran.

  Then look at these firms getting bailouts and then going on $400,000.00 junkets for their own personal pleasure, no matter that it was Main Street that bailed them out.

  Unscrupulous greed, lies and theft. < :-)

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  sdmsec at 12:17 PM JST - 14th October

  This problem was created from Main St all the way to Wall Street.

  As you've stated before, we rarely agree, but I agree with you on the statement above.

  It really takes two to tango: many covetous main streeters with a "give it to me NOW" mentality and many greedy Wall Streeters with a twisted sense of risk-reward ratios.

  The sad thing is that those of us who didn't participate are the only ones left with something of value. So naturally, those in Washington ignore Constitutional limits and take from us to prop up the covetous and greedy. We get screwed for being fiscally responsible.

  I wish the government would keep out - let it crash. I'm prepared right now to buy low. That's the reward I deserve for being prudent.

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