Crisis Diary as it unfolds ….

24-Nov-08 to 30-Nov-08: Terror strikes financial capital of India – Mumbai

The Mmumbai-attacksaximum City burns in terror

By far, the biggest news of the week was the terror attacks on Mumbai. Mumbai burnt in the horror that started on Wednesday Nov 26 night and lasted for almost 60 hours leaving almost 200 persons dead, 400 injured, Taj and Oberoi hotels ravaged and a nation of 1 billion deeply pained and outraged. The issue of global Islamic terror network is back at the table. The time when the world is facing the gravest of the economic crisis, the last thing world wants is another war that has potential to unfold itself in a world war. In coming days, the commitment of Pakistan to assist India in fighting terror and the role of US to influence swift action on part of Pakistan are going to be crucial to how situation pans out.

Obama’s economic team

Obama unveiled his economic team packed stalwarts like Geithner, Larry Summers, Paul Volcker. Many of Obama’s team worked for Clinton during second Clinton administration. Also, important thing is there are no left-extremist in Obama’s policy team, which is not such a bad thing.
But is Obama’s team full of too much of ego per capita? Will they ever reach a consensus decision?

This week stock markets took a breather and bounced back a bit. Are we gearing up for some Obama bounce? or some stimulus news stimulated bounce?

Unstable BRICs

Among emerging markets economies, Russia seems to be in really bad shape. Falling ruble, falling commodity prices, drying forex kitty and frozen credit markets, just nothing seem to be working for Russia. China, with its announcement of record rate cut by 1 percent, seem to be panicking about the situation. Record stimuluses, massive rate cuts only point to desperate measures to support falling economy.

Crisis watch for the week:

TED spread 2.18 (prev 2.12)
VIX 55.28 (prev. 80.26)
S&P 500 896.24 (WoW return +11.2% )


November 30, 2008 - Posted by | Crisis Snapshot

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