Economic Update

[on edit]
The lead off news is that the head of the IMF. Dominique Strauss-Kahn, is calling the global economic situation "serious".

As to what he's considering, Strauss-Kahn, a Frenchman is meeting with French President Nicolas Sarkozy to see what a the French response must be.

It just feels so good to be rescued by the French, huh?

Well, we don't have US quotes, because it is a holiday, but there was a lot of blood in the foreign markets, with the FTSE-100 fallint 5.5 percent, the CAC-40 6.8%, and the DAX 30 plummeting 7.2 percent in Europe, and in Asia, the Shanghai Composite fell 5.8%, the (Singapore) Straits Times Index fell 6% (15.8% for the year), and India fell 7.4%.

The "markets" don't think that the stimulus package, which is to say GW Bush's "no money for the working poor" package, which tanked the US markets on Friday, Sucks.

For what it's worth, the US meltdown is beginning to hit Europe, where there is increasing pressure for the ECB to lower interest rates. (My guess is not right now. The ECB is charged with keeping inflation down only, no requirement on employment)

European banks are tightening up lending standards in response to the meltdown, so short term liquidity problems may be coming to Europe too.

We also have the Bank of China, the 2nd largest lender in that country, share price dropping by over 6% because of concerns over their subprime exposure. There are rumors that they will show a net loss in 2007 as a result.

Oil, however seems not to be spiking lately. Recession fears have a way of doing that.