May The Festivals Bring Cheers to The World Economy including Nervous Indian Financial Market
It has been quite long that I posted and I am sorry for that. Actually, it has been quite hectic few weeks not only in my personal life, but also the world financial market where the ever so known face of the Wall Street as giant investment banks collapsed like pack of cards thus triggering a world financial crisis.
But first thing first - it is festival season in my place and we got 2 weeks holidays for it. This is the time when many Hindu Goddesses get worshiped with much fun and flair. Although I am not Hindu by religion, still I grew up in close proximity with them and know most things. Mythologically, the Hindus have hundreds of Gods but out of them only few are worshiped in big way. And also the enormity of festivals depend from region to region. For example, Durga Puja is the biggest festival for Bengali community whereas it is Ganesha Puja in Mumbai. As I live in an area dominated by Durga Puja worshipers, our school has been closed since 3rd October and will open only on 17th. I do not like the crowd - and so took refuge in my village house for 9 days. All those days were spent without accessing the NET.
Today is the Laxmi Puja or festival of the Goddess of wealth. Hence, my best wishes to all those managers of mutual funds, investment banking who have been going through stress since the crisis started. Most analyst say that it is a result of the sub-prime crisis that engulfed the US market few months back. It is being seen as the greatest economic crisis since the great depression days of 30’s.
Europe has already felt the effect and now Asia too is feeling it with Pakistani financial market on the verge of collapse. India is getting very nervous which has been proved by the government constituting a crisis committee headed by finance secretary Mr. Arun Ramanathan to tackle any crisis that may start in India. The committee is working overtime and leaving no stone unturned to toss options including revising the Cash Reserve Ration (CRR) by 150 point basis which will make more funds available to financial institutions.
However, governments in Europe are not sitting idle as they got together to fund a multi-billion dollars bail-out plan for banking and financial sectors. Britain has already called for a new Bretton Wodds agreement to give a new direction and shape to the world financial system. This has lifted the spirit of the stock markets which went tumbling over last couple of weeks.
But one thing is sure - the crisis has shaken up the world financial system! Though it might not affect immediate cash flow in developing country looking for foreign direct investments (FII), it will slowly dry up funds from the markets thus causing somewhat of deflation.
Anyway, lets just hope with our fingers crossed and let our planner
October 14th, 2008 at 11:40 am
Here in Europe it is said that financial crisis will (if it will) affect US and Europe but not China and India. Good thing about this crisis is that oil went down.