Trouble?

[ironphoenix]

Well, it looks like some is happening. itlandm brought my attention to a fairly important harbinger of an economic crash: the banks don't trust each other to stay solvent. For details, see these three articles from The Economist.

ETA: This is looking serious. Here are a few more references from other sources:

• Malaysia Star
• Wall Street Journal
• MSNBC
• Bloomberg's

ETA some more: The Canadian situation is summed up in this article from The Globe and Mail.

ETA one (last?) time: The US Federal Reserve dropped its preferred rate by 0.5%. This is stabilizing markets, but I expect it to pull the US dollar down. This is, I think, a painful but prudent and necessary move on their part: the greenback is overvalued, and this will help adjust it without catastrophic consequences.

Comments

[jagash.livejournal.com]

Oh dear.

[ironphoenix.livejournal.com]

Something like that; see my last ETA for more optimistic news, though.

[jagash.livejournal.com]

Aye, seems prudent.

[itlandm.livejournal.com]

It is quite amazing, is it not? To be able to follow such an event, not just in our lifetime, but practically from hour to hour. This could (and probably will) be forgotten except by economist. But it could also go into history under some cheesy name, if someone misses a step. And it is impossible to say who might do that, or when. Chaos theory is definitely lagging behind chaos practice ...

[ironphoenix.livejournal.com]

Indeed! Economics is an interesting artificial ecosystem, I think.

[ancalagon-tb.livejournal.com]

I thought this article, speaking about the root of the problem (bad mortgage practices) to be helpful

http://en.wikipedia.org/wiki/Subprime_mortgage_financial_crisis

[ironphoenix.livejournal.com]

Yes, good article; thanks for the link!

I like the media articles for another reason: seeing the spins worldwide was interesting. The Australians in particular pooh-poohed the whole thing.