Seven Red

“You’ve got national governments trying to deal with a global problem.” -Richard Quest, responding to a 9% drop in the Nikkei, 3 minutes before European markets open.

Check your TIAA-CREF if you’ve got one. Not pretty.

From Japan…Information cascade: panic selling. People talking about “underlying economies.” The US consumer buying Toyota: if they can’t get the loan to make that big purchase, etc. “Now analysts are scratching their heads…Analysts trying to figure out what it was in the psychology that made the market go so bad…the ‘real economy’…the nuts and bolts of what makes Japan tick…Bank of Japan has been injecting funds for 16 straight days.”

UK “partially nationalizing the banks.” Hooo boy. I like that somebody is called Chancellor of the Exchequer. $87 billion for British bank bailout, plus $350 billion credit line. Quest wonders who’s going to take out a loan when the job may be gone next week. It strikes me as a not irrelevant question. Relief that Europe opens up “only” 3% down. Banking shares in the UK recovering, but is anybody buying? CNN headline amusing: “Worries deepen over world financial turmoil.” (2:13 CDT). DAX and Paris both down 4%. CNN flashed the 9.38% Nikkei drop when they were talking about the FTSE and the anchors were like “Whoa, don’t be scared…that’s Tokyo, not London.”

Iceland near bankrupt: no money coming out of the ATM’s. What will happen to West Ham, boyos? The Hammers are owned by Icelandic banking interests. Ooops. Maybe not so funny, since now they’re worried about food imports into Iceland. “Fear, dread, concern…but won’t use panic just yet,” says the newsreader…This is fascinating stuff. London, Paris, Germany diving close to 5% now; anchors started worried, now looking concerned.

Quest: “You’re all fixated on the markets! The egg was hatched in Iceland, when somebody tried to take money out of the bank and couldn’t…” Co-anchor: “Fear seems to have gripped everyone now…confidence.” Quest: “This is not a movie where suddenly three quarters of a way through something happens and everything’s fine! Don’t be naive!” Hilarious!!! Quest: “They’re now attacking this with a water pistol…It is not going to end…you won’t be able to spot the turn.” Some German guy up now in a wacky sweater and upturned Eurotrash collar. “Japn is not about the banks or the financial system, but about the exporters…experts afraid world is going to enter a depression.” But why, then, did the banks fall sharply? German dude: “They didn’t. Worry is about the ‘real economy.’” Welcome to the desert of the real…

Must sleep. Wreckage tomorrow? We shall see.

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