The key week of the next decade

That is my prediction for this week. Quite a strong one, but it seems there have been 4 key developments that are going to dictate events:

1 - The US bail-out, so vaunted just days ago, looks like it will not achieve any kind of market reaction at all at the moment. No one would have predicted this ten days ago, which just shows how deep we are in uncharted, indeed, unchartable waters.

2 - The EU banks have appeared to be in just as much trouble as the US ones, the EU will now suffer accordingly. If Germany has guaranteed all deposits like Ireland, then the whole of Europe's financial and government system will be shaken to its core this week.

3- The CDS market settlement continues and so banks are not going to lend any money to anyone until this is all settled. If key industries like power and airlines can't access the credit they need then the lights go out and the planes will be grounded.

4. Hedge funds continue to have their funds called in by investors, liquidating more positions will drag the markets down further and destroy more confidence - some are predicting a very big stock market crash for this week.

Still, happy days eh? Hopefully we will all muddle through somehow...

Now I know things are bad

Just posted the comment below Guido's. Apart from the very odd footie match I only really watch Newsnight on Telly. This is now being replaced by CNBC and Sky News. Sad how much things have developed....








"The whole programme last night was flawed. Red Ken and Paddick, both defeated by Boris and laying into him. A Labour Government minister also oddly deciding Boris had done wrong. One Tory who was only allowed to speak under 4 way cross-examination. Barely a mention of any scandal.

Funny, no member of say the de Menezes family on for balance?

AND

Then on comes 'marxist' Paul Mason to warn the world is doomed without massive government intervention everywhere in the economy.

Worse he says, the Irish, the Yanks and the Europeans are going to do it...we'll be last in the gravy queue of socialism. As if somehow Gordon and Alistair throwing all our good money after bad is the only idea in town. His piece to Paxo almost ended in tears (his, Paxo seemed out of his depth).

I used to love Newsnight, it is a disgrace these days.