Is the economic crisis scaring you yet?

Stencilled on an ATM in San Francisco. Image by "Quandaries" on Flickr.

We asked our Observers, from Cotonou to Melbourne, if they were starting to feel worried by the financial crisis that's wreaking havoc on the world's stock markets. You, too: send us your comments.

Contribute to this post with your own country's outlook on the crisis.

"This is not our crisis!"

Bertrand Kpogo is a Beninese blogger and a Web-site administrator.

At the last UN General Assembly, Beninese President Yayi Boni made it known to President Bush that he didn't think it normal to release so many billions of dollars in aid for this crisis. Many Beninese think that this money could be used to help us get out of the food crisis instead.

The financial crisis is not our crisis! The subprime crisis neither; it didn't have anything to do with us. We're just getting out of the food crisis. It's been very hard and it's still haunting us. Here in West Africa, we don't have a stocks-and-shares culture. Few Beninese or Togolese buy shares or get involved in financial affairs, which explains why the stock markets in Ghana and Abidjan for example - where there are lots of foreigners - were thrown into panic. That hasn't been the case here in Cotonou, however. We haven't noticed a rise in prices either.

In Africa, we're actually much more sensitive to the petrol crisis, because a lot of our goods are imported, and each time the price of a barrel increases, the sectors that import become paralysed." 

"We're not even allowed to negotiate these deals"

Daudi Were, from Nairobi, runs a company that helps Kenyan and East African NGOs set up and use online networks.

We're really bracing ourselves now. Although it hasn't affected us yet, we know the next couple of months are going to be really hard. People have certainly become a lot more sceptical about lending money. It's hard enough to get a loan in Kenya at the best of times! People will start getting angry soon, when they realise it's affecting them directly.

If anything this highlights the need for more global cooperation. As Africans, we feel like decisions are being made that will affect us directly, and yet there's nothing we can do about it. We're not even allowed to negotiate these deals. We feel hopeless."

"Clients (…) don't buy the high-end products anymore"

Awab Alvi is a private dentist from Karachi, Pakistan

This is certainly having an affect on my business - I've noticed the difference and tightened my belt accordingly. You see that when clients come they don't buy the high-end products anymore, which is what makes the big difference in profit. While people used to get their teeth whitened, it's not a necessity, so they cut it out. There are a lot less people having braces too. These are essentially cosmetic products, and for that side of the industry, things are going to get much worse soon."

"People will still have 10 dollars to spend on a waffle"

Marc Laucher owns a waffle and sandwich store, Waffle On, in Melbourne, Australia.

My business hasn't been affected by the crisis yet. The stock market might have felt the difference, but Australia is so involved with China, that as long as the Chinese continue consuming, we're protected.

The big restaurants will surely be the first to be affected, but people will still have 10 [Australian] dollars [5 euros] to spend on a waffle. It's a little treat that doesn't break the bank!

What's happened in the US makes me laugh - it's the biggest free market in the world, but this proves that a bit of state intervention now and again wouldn't go amiss.

In 1986 I was living in the USA, in Dallas, and the French restaurant that I worked in went bankrupt. So I really feel for the people that find themselves in that situation now." 

"They're all rushing to buy dollars"

Cristina Civale is a writer and journalist in Buenos Aires.

The crisis is on the cover of all the papers - even Critica de la Argentina, [a newspaper known for its harsh critiques of economic management in the country] used the headline "Black Monday" today [Tuesday]. The government, a bit late, has started to take some measures now. They're thinking about 'dolarising' all bank deposits, as people are worried about the value of the Argentinean peso. It's quite incredible; they're all rushing to buy dollars to protect their savings.
   

However, our economic problems are so deep here that our crisis is permanent anyway. What can a few more problems do to us? We suffer from crazy inflation rates and the constant devaluation of our wages. Argentina is and always has been a model for this type of crisis; we've been living it since I can remember.

Despite this, people are still worried about how it might affect our already-fragile country. As we don't seem to get any reassurance or explanation, we do what we've learnt to do - take our money out of the bank, buy dollars, and wait for things to get better."

"I heard about the crisis two days ago"

Yasmin Zata Ligouw is a language teacher and former journalist from Jakarta. She considers herself part of the Indonesian middle-class.

I heard about the crisis two days ago through the press. Last week, the Jakarta stock exchange was closed because of the end of Ramadan celebrations, so this crisis is kind of 'newer' here. Of course it's a bit scary, especially because I have a family to look after and my husband and I have mortgage with the bank. But I'm confident in the Indonesian economy. Our president keeps saying that we won't live the nightmare of the Asian financial crisis of 1998 again, and most people believe that it's actually true."

Comments

Credit Default Swaps (CDFs) - Why is the media silent?

Nobody in the media is talking about the real tsunami about to overwhelm the financial markets - the $62 trillion fiasco of Credit Default Swaps! This will make the sub-prime problems look like a mere ripple on a pond. CDS are totally unregulated & opaque instruments which Warren Buffet has described as the WMD's of the finance world. Google CDF's and find out what the media isnt telling you

Greenspan & one aspect of the financial crisis - US

The naivety of Greenspan believing that financial institutions somehow would police themselves in an effort to protect their self-interest is staggering considering the heft and the scope of influence he has been granted for many years.

Aside from this painfully obvious fact my hope is that because of this financial crisis and the unstable US job market unemployment benefits be lengthened for people currently receiving these compensations. If this is not part of any financial bailout being considered right now more people will be at risk, and more foreclosures adding to the present disaster that is on our table right now.

I'm afraid that the worse is

I'm afraid that the worse is coming earlier than expected.

crisis?

over the past year,petrol prices went up from about £1 per litre to £1.20 per litre;accordingly food,e.g bread,potatoes,fruit,and meat rose by 20%.Now the petrol price has dropped back 20%,can someone tell the shops to drop the food prices back by the same?

stocks & shares

its about time that the smart alecs in the stock exchanges of the world stopped putting every ones lives on edge my suggestion is that if you buy shares you must keep hold of them for at least a week or maybe a fortnight before you are allowed to sell them on thereby stopping the get rich quick merchants from ripping everyone off

the current financial crisis

the current financial crisis is everybodys crisis, there is no way that it does not affect everyone on the planet . Unfortunately we have to bale out the greedy fat cats , or our problems just get bigger . In these situations the rich will get less rich , but everyone else could lose the lot .mind you there are going to be a lot of people falling on 24 carat swords , and now we own the bank this should always be public knowledge , I bet the number of peeredges from the banking world shrinks for 5 minutes until we find a banker to reward for digging us out of his mess with our shovel .Politicians should take note too , accountability should start at the top, but in a world where once again the accountants will not sign off on the EU`s fairy- tales, sorry accounts this is not likely, still this is as close to a slap wrist to the politicians and their bedfellows as we are ever likely to see .This might be the equivalent to Lady Thatchers Falklands war for Gordon ,but it wont be enough, it is the difference between winning and surviving.

Bankers are responsible for the financial crisis due to greed

Basically the bankers are responsible for the financial crisis and credit crunch due to the serious impact of deregulation by the policies of Reagan and Thatcher in the mid 1980s.It started with the culture of greed and irresponsible by the bankers, speculators and hedge fund managers that they do not give a damn to the ordinary hard working families in Britain. The fatcats in the City of London earning huge bonuses are also bank robbers and assets strippers are very selfish based on the culture of greed and do not care about the need of ordinary people.

Credit Markets

I was very surprised to find out our entire economy is run on credit! Normal, average people don't live like that; I told my representatives to introduce the wall street people to bankrupcy court & return to a market where money is worth what it represents. Replace credit with assets. With 90% against the wall street bailout - they ignored us.

The reasons behind this mess

The overall problem is that over recent years Capitalism has become greed capitalism. Investors and companies have put profits above all consideration for other citizens. Greed of profits from supplying essentials such as water, fuel oils, gas, electricity. Greed from exploiting cheap labour in external countries to produce goods more cheaply than the by the native workers, thus putting millions of native workers out of work and the taxpayers picking up the bill to pay the social and un-employment monies (that is a case of investors robbing the state for their own money greed!). Company executives taking extreme high salaries and paying out extreme high bonuses to fellow executives and shareholders, this money should have been re-invested in the businesses! When a company goes into business it is understood that the company will always have enough financial assets to support it, otherwise it is to be declared bankrupt, many banks, maybe due to their excessive influence over people in high places, were able to ignore this important condition and so carry on trading with hidden debts! Too many people in authority turned a blind eye to falsifications and curruptions by those in the rich dealers circles! After Thatcher, even normal people became house traders , buying and selling houses for profit (the greed syndrome installed by thatcher into so many minds, "never mind you Jack, I,m alright" was the catchphraseof the day). In this day and age when the world is becomming over populated, houses should be for living in , not for commercial profiteering! Ive probably missed many other causal factors but these are probaly the most likely for the current colapse.
By the way, I am a capitalist and have run and managed my own businesses but for the sack of making a personal living and employing others.
It is about time that our politicians, took charge of excess payments to themselves and over paid executives, footballers and similar (these are the people who take more than their share of the worlds pleasures and essentials)!

Absolutely spot on. You put

Absolutely spot on. You put your finger on the basic problem, privitisation of the basic utilities so that governments could generate cash from the assets owned by the taxpayer. Evene the naive taxpayer fell for the line that they would make a killing investing in an asset that they already owned!
Margaret Thatcher started the rot and the greed culture and successive governments followed her greed model. The rich got richer at the expense of the poor. Until the ordinary hardworking people realise that they have been duped the great capitalist fraud will continue. We need to have social capitalism one were people count more than wealth.

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