November 2008 was similarly peppered with interesting developments in the financial and economic world, which saw once spectacular blue-chip institutions such as General Motors and Citigroup being brought to their knees as the credit crunch continues its devastating rampage. At the risk of sounding like an over-zealous newscaster, I will elaborate on the events of this month in the next paragraph, and will try to temper the tone of language in order to achieve a more sober address.
With Hong Kong, Japan and Germany officially in recession, it would just be a matter of time for the United States. This will probably culminate (and go down in history) as the first truly global recession and economic downturn. There are probably many books which will be written on this in the years to come, and the amount of wealth destruction has gone into the trillions of USD. So, if you are an individual (like myself) and feel that you are getting somewhat poorer, don’t fret because millions of others around the globe are probably in the same boat or doing much worse. Even billionaires and millionaires have been unable to escape unscathed as their wealth has fallen dramatically during such hard times. It is only with prudence, fortitude and determination that one can get through these unprecedented times.
The problems with USA auto-manufacturers rose this month as a result of a sharp drop in USA consumer confidence and spending, leading to the worst sales for auto manufacturers in at least 20 years. The 3 biggest car companies (located in Detroit), namely General Motors, Ford and Chrysler, petitioned for the Federal Reserve to extend financial assistance to them, or they may be bankrupt by June 2009 as a result of high cash burn and flagging sales. As of this writing, there was still no definitive solution to their woes, though President Obama has mentioned some form of aid package to be made available to them. Citigroup, the once vaunted financial institution, was on its knees as it laid off 50,000 staff worldwide and sought to raise more capital. You can read on Bloomberg or CNBC the steps taken to rescue Citigroup, and I shall not elaborate on it. Read more...November 2008 was similarly peppered with interesting developments in the financial and economic world, which saw once spectacular blue-chip institutions such as General Motors and Citigroup being brought to their knees as the credit crunch continues its devastating rampage. At the risk of sounding like an over-zealous newscaster, I will elaborate on the events of this month in the next paragraph, and will try to temper the tone of language in order to achieve a more sober address.
With Hong Kong, Japan and Germany officially in recession, it would just be a matter of time for the United States. This will probably culminate (and go down in history) as the first truly global recession and economic downturn. There are probably many books which will be written on this in the years to come, and the amount of wealth destruction has gone into the trillions of USD. So, if you are an individual (like myself) and feel that you are getting somewhat poorer, don’t fret because millions of others around the globe are probably in the same boat or doing much worse. Even billionaires and millionaires have been unable to escape unscathed as their wealth has fallen dramatically during such hard times. It is only with prudence, fortitude and determination that one can get through these unprecedented times.
The problems with USA auto-manufacturers rose this month as a result of a sharp drop in USA consumer confidence and spending, leading to the worst sales for auto manufacturers in at least 20 years. The 3 biggest car companies (located in Detroit), namely General Motors, Ford and Chrysler, petitioned for the Federal Reserve to extend financial assistance to them, or they may be bankrupt by June 2009 as a result of high cash burn and flagging sales. As of this writing, there was still no definitive solution to their woes, though President Obama has mentioned some form of aid package to be made available to them. Citigroup, the once vaunted financial institution, was on its knees as it laid off 50,000 staff worldwide and sought to raise more capital. You can read on Bloomberg or CNBC the steps taken to rescue Citigroup, and I shall not elaborate on it. Read more...
