Wednesday, September 17, 2008
Financial Crisis

Financial Crisis
The sub-prime crisis has hit the world hard, especially in US, China and Japan. Never had i imagined two of the largest investment banks in the world to crumble. First Lehman Brothers incurred the largest debt ever and was liquidated. Next came Merrill Lynch, in a sudden takeover by Bank of America. And now, the latest is AIG - one of the largest insurance company in US.

What's happening to the world? I guess this is a question lingering somewhere in the back of almost everyone's minds. Financial institutions are no longer that safe and infallible as we all thought them out to be. One by one, due to the mortgage crisis, are either toppling or struggling to stay alive. Fortunately, JP Morgan and Goldman Sachs are stablized and hanging on well.

This is definitely taking a toll on all investors, especially those high net worth individuals who invested big time in these major companies. Fortunate ones who escaped unscathed are those who diversified their investments. Lucky you.

Will a domino effect occur and strike Asia?

Currently, Singapore isn't very badly hit by this sub-prime crisis but who knows how much investments major corporations in Singapore made in these fallen investment banks? Luckily for regulators who manage Singapore's finance industry. Reserves are in surplus and should be able to cover any losses made when events like this happen. But for how long can they survive? Well, with fingers crossed, hopefully investments in Singapore will be safe now, and in the future.

What lies ahead for the world? No one knows. But as it is now, everything looks grim.

Who's next?

Me

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