The week Wall Street capitulated
In October the credit crunch finally devastated global equity markets as investor panic threatened to bring down all but the very strongest banks. Alex Chambers was pounding the sidewalks of New York just as the crisis entered its most tumultuous period and perhaps its denouement.
IT WAS AN inauspicious start to the week of October 6: Hank Paulson had finally got his Troubled Assets Relief Program and yet there was no relief to the sell-off in stocks – far from it. US stocks sold off the previous Friday despite Congress finally agreeing to contribute to the administration’s $700 billion begging bowl. Could it be that the bowl was not big enough?
Waking in the wee hours in New York – as is the way for the traveller from London – the early morning news programmes were fevered in tone. Worse was surely to come given London’s awful opening, hardly a surprise given that the price action from Asia was so bad: in Japan the Nikkei was down 511 at 10427 while the Hang Seng hung low at 17090, off by 593 – the UK’s Footsie was to end that day 391 points lower.
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