Thursday, January 31, 2008

This Is How the Financial Cookie Crumbles

If you read the business press carefully, you already know that the global financial market is crumbling. Serious? Yeah, dead serious.

To be sure, it will take a while. But just recently the world's biggest bank, Citibank, announced a US$24 billion write-off, and estimated it will lay off up to 24,000 employees. This is another episode in a series of such news since August last year.

Citibank is one among many that have taken a blow as a result of the meltdown of their "subprime" mortgage deals and other credit-related losses. There is much more to come...

This Oskari Juurikkala article from Mercator is an important read for anyone who wants to understand how the financial crises came to be and what, if anything, can be done about them.