World Financail Crisis (Interview of Sakina Hussain)

NYSE( NewYork Stock Exchange) and financial crisis

In the midst of the global financial crisis, the US mining industry and the energy resource sector continues to outperform the market and remains as an investment hotspot for many institutional investors from Asia. NYSE resources sector remains investment hotpsot depsite financial crisis. Apart from strong demand for commodities in China and other still growing economies like India, the Chinese government also plays an important role in encouraging its business and nationals to invest in overseas market.

Wall Street

A series of monumental bank and investment firm failures precipitated by a massive increase in foreclosures, panic in the global financial markets, and a staggering $700 billion bailout proposal that was still being fine-tuned over the weekend in Washington. The collapse of so many financial companies is the culmination of the subprime crisis, which came to light in 2006 and 2007 but was in reality brewing for quite some time. Up through the late 1970's, home mortgages were heavily regulated. A complex process which bundles, sells and repackages loans into bonds to be sold to investors allowed lenders to spread the risk and frees them from reliance on deposits and capital reserves, securitization was key to sub-prime lending because it diffused the potential of risks and default for lenders and removed rational incentives for prudent lending.

Dow Jones

The Dow Jones index fell 678.9 to 8579.2, its biggest percentage drop since Black Monday in October 1987 and its third biggest points decline in history.America’s mortgage crisis has spiraled into “the largest financial shock since the Great Depression” and there is now a one-in-four chance of a full-blown global recession over the next 12 months, the International Monetary Fund warned today.

Lehman Brothers Bankruptcy

Lehman Brothers, one of the most prestigious players on Wall Street, filed for bankruptcy protection this morning after a frenzied weekend of negotiations failed to find a way of saving the company. The collapse of Lehman – one of the biggest financial shocks in years - puts tens of thousands of jobs around the world at risk. It also sent shockwaves around the banking world, with commentators predicting that the damage could be felt across the industry and could help to push the UK into recession. The collapse of Lehman sent traders rushing into government treasury bonds – seen as a safe haven in troubled times. The dollar fell against both the euro and the yen.

IMF (International Monetary Fund)

The IMF is helping countries address the fallout from the devastating economics crisis. In recent months, it has provided loans worth more than $50 billion to emerging market countries.

The IMF's lending to low-income countries has also been stepped up as developing countries start to feel the effects of the crisis.

he IMF has urged the Group of Twenty (G-20) industrialized and emerging market countries to take more decisive policy action to combat the corrosive global financial and economic crisis by bolstering demand and cleaning up the financial sector.

Housing Market Declined

The housing slump set off a chain reaction in our economy. Individuals and investors could no longer flip their homes for a quick profit, adjustable rates mortgages adjusted skyward and mortgages no longer became affordable for many homeowners, and thousands of mortgages defaulted, leaving investors and financial institutions holding the bag. This caused massive losses in mortgage backed securities and many banks and investment firms began bleeding money. This also caused a glut of homes on the market which depressed housing prices and slowed the growth of new home building, putting thousands of home builders and laborers out of business.