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Economy
In reply to the discussion: STOCK MARKET WATCH -- Friday, 24 January 2014 [View all]xchrom
(108,903 posts)14. Contagion Spreads in Emerging Markets as Crises Grow
http://www.bloomberg.com/news/2014-01-24/contagion-spreads-in-emerging-markets-as-crises-grow.html
The worst selloff in emerging-market currencies in five years is beginning to reveal the extent of the fallout from the Federal Reserves tapering of monetary stimulus, compounded by growing political and financial instability.
The Turkish lira plunged to a record, while Ukraines hryvnia sank to a four-year low and South Africas rand fell to the weakest level since October 2008, after tumbling yesterday beyond 11 per dollar for the first time since 2008. Argentine policy makers devalued the peso by reducing support in the foreign-exchange market, allowing it to drop the most in 12 years to an unprecedented low.
Investors are losing confidence in some of the biggest developing nations, extending the currency-market rout triggered last year when the Fed first signaled it would scale back stimulus. While Brazil, Russia, India, China and South Africa were the engines of global growth following the financial crisis in 2008, emerging markets now pose a threat to world financial stability.
The current environment is potentially very toxic for emerging markets, Eamon Aghdasi, a strategist at Societe Generale SA in New York, said in a phone interview yesterday. You have two very troubling things: uncertainty about the Fed policy, combined with concerns about growth, particularly in China. Its difficult to justify that its time to go out and buy emerging markets at the moment.
The worst selloff in emerging-market currencies in five years is beginning to reveal the extent of the fallout from the Federal Reserves tapering of monetary stimulus, compounded by growing political and financial instability.
The Turkish lira plunged to a record, while Ukraines hryvnia sank to a four-year low and South Africas rand fell to the weakest level since October 2008, after tumbling yesterday beyond 11 per dollar for the first time since 2008. Argentine policy makers devalued the peso by reducing support in the foreign-exchange market, allowing it to drop the most in 12 years to an unprecedented low.
Investors are losing confidence in some of the biggest developing nations, extending the currency-market rout triggered last year when the Fed first signaled it would scale back stimulus. While Brazil, Russia, India, China and South Africa were the engines of global growth following the financial crisis in 2008, emerging markets now pose a threat to world financial stability.
The current environment is potentially very toxic for emerging markets, Eamon Aghdasi, a strategist at Societe Generale SA in New York, said in a phone interview yesterday. You have two very troubling things: uncertainty about the Fed policy, combined with concerns about growth, particularly in China. Its difficult to justify that its time to go out and buy emerging markets at the moment.
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Surveillance and Scandal Time-Tested Weapons for U.S. Global Power By Alfred McCoy
Demeter
Jan 2014
#6
It hasn't gottten any easier, either. And DEFINITELY not any fairer or equitable.
Demeter
Jan 2014
#22