France blames crisis on US failure over Lehman

French Finance Minister Christine Lagarde yesterday traced the start of the gobal financial meltdown to the US’s “dramatic” decision not to save the Lehman Brothers bank.

Lehman sought bankruptcy protection on September 15, after frantic talks failed to find a buyer for the US$600 billion Wall Street giant and the US government decided not to step in and save it. “As far as I am concerned, that was a mistake,” Lagarde said, in an interview with RTL radio, complaining that a government bail-out would have reassured markets.”When you let one domino fall, the others follow.”The collapse of Lehman Brothers, one of Wall Street’s most established banks, sparked turmoil on financial markets across the world.- Nampa-AFP Nordic stocks plunge with 6% losses * Stocks in the Nordic region fell sharply in opening trading on yesterday along with other European markets, with Copenhagen and Oslo each down more than 6 per cent amid deepening financial turmoil.The Copenhagen stock exchange saw the biggest drop, down 6,91 per cent in early trading.Oslo was down 6,17 per cent, with shares in Danske Bank losing 13,76 per cent of their value.Stockholm fell by 3,88 per cent, dragged down by banking shares that were battered, like others in Europe, by the growing crisis in financial markets.The Helsinki stock OMX25 stock index fell 3,18 per cent.- Nampa-AFP Indonesia suspends trade as market plunges * Trading on the Indonesian stock market was suspended due to “irregularities” yesterday after the main index plummeted more than 10 percent in mid-morning trade, officials said.The exchange said trading had been halted for an “indefinite period” after the market nosedived in response to sharp falls on Wall Street overnight.The main index in Southeast Asia’s largest economy had fallen 10.4 per cent to 1 451,67 points on thin volume before trading was halted.”This is standard procedure that we have to take when facing these kinds of conditions,” Indonesian Stock Exchange President Director Erry Firmansyah told AFP.”We observed that there were irregularities in the market’s movement and we had to stop it,” he said, referring to the large fall in relatively thin trade of about one trillion rupiah (US$106 million).”It’s irrational movement.We suspended the market so people can be more calm and think rationally.”The only other time trade had been halted in the exchange was when a bomb exploded in the basement in 2000, killing 10 people.Yesterday’s plummet follows a 10 per cent fall on Monday, the biggest decline since the onset of the Asian financial crisis ten years ago.The selling binge came a day after Indonesia’s central bank raised its benchmark rate by 25 points to 9,5 per cent to combat higher-than-expected 12,14 per cent September inflation.- Nampa-AFP Moscow freezes trading * Trading was frozen yesterday on Russia’s two main stock markets after plunges of more than 11 per cent on opening, driven downward by huge falls in Asia amid global financial turmoil.The main RTS exchange was down 11,25 per cent at 761,63 points when the suspension was enforced by Russia’s main financial regulator, while the MICEX had tumbled 14,35 per cent to 637.87 points.The Federal Service for Financial Markets ordered a one-hour halt to trading on the dollar-denominated RTS, the exchange said in a statement on its website.On its ruble-based counterpart, the MICEX, trading was suspended until Friday or until further orders from the service, an exchange spokesperson told AFP.Both bourses are more than 65 per cent down from their all-time highs in May.”With the US market off five percent overnight and Asia down five to seven percent this morning, things bode ill for the Russian market yet again,” Moscow-based Alfa Bank said in an advisory yesterday.”Meanwhile, damage from the credit crisis and global slowdown is showing up in the real economy” in Russia, including in its important steel and oil sectors, the bank said.On Tuesday, Russian shares appeared to stabilise, with the RTS down 0.95 per cent and the MICEX losing 0.96 per cent on a day in which trading was suspended for several hours to halt a major slide.An announcement Tuesday by President Dmitry Medvedev that the government was increasing its bank rescue package by 36 billion dollars (26.6 billion euros), failed to materially move the market, Alfa Bank said.- Nampa-AFP”As far as I am concerned, that was a mistake,” Lagarde said, in an interview with RTL radio, complaining that a government bail-out would have reassured markets.”When you let one domino fall, the others follow.”The collapse of Lehman Brothers, one of Wall Street’s most established banks, sparked turmoil on financial markets across the world.- Nampa-AFP Nordic stocks plunge with 6% losses * Stocks in the Nordic region fell sharply in opening trading on yesterday along with other European markets, with Copenhagen and Oslo each down more than 6 per cent amid deepening financial turmoil.The Copenhagen stock exchange saw the biggest drop, down 6,91 per cent in early trading.Oslo was down 6,17 per cent, with shares in Danske Bank losing 13,76 per cent of their value.Stockholm fell by 3,88 per cent, dragged down by banking shares that were battered, like others in Europe, by the growing crisis in financial markets.The Helsinki stock OMX25 stock index fell 3,18 per cent.- Nampa-AFP Indonesia suspends trade as market plunges * Trading on the Indonesian stock market was suspended due to “irregularities” yesterday after the main index plummeted more than 10 percent in mid-morning trade, officials said.The exchange said trading had been halted for an “indefinite period” after the market nosedived in response to sharp falls on Wall Street overnight.The main index in Southeast Asia’s largest economy had fallen 10.4 per cent to 1 451,67 points on thin volume before trading was halted.”This is standard procedure that we have to take when facing these kinds of conditions,” Indonesian Stock Exchange President Director Erry Firmansyah told AFP.”We observed that there were irregularities in the market’s movement and we had to stop it,” he said, referring to the large fall in relatively thin trade of about one trillion rupiah (US$106 million).”It’s irrational movement.We suspended the market so people can be more calm and think rationally.”The only other time trade had been halted in the exchange was when a bomb exploded in the basement in 2000, killing 10 people.Yesterday’s plummet follows a 10 per cent fall on Monday, the biggest decline since the onset of the Asian financial crisis ten years ago.The selling binge came a day after Indonesia’s central bank raised its benchmark rate by 25 points to 9,5 per cent to combat higher-than-expected 12,14 per cent September inflation.- Nampa-AFP Moscow freezes trading * Trading was frozen yesterday on Russia’s two main stock markets after plunges of more than 11 per cent on opening, driven downward by huge falls in Asia amid global financial turmoil.The main RTS exchange was down 11,25 per cent at 761,63 points when the suspension was enforced by Russia’s main financial regulator, while the MICEX had tumbled 14,35 per cent to 637.87 points.The Federal Service for Financial Markets ordered a one-hour halt to trading on the dollar-denominated RTS, the exchange said in a statement on its website.On its ruble-based counterpart, the MICEX, trading was suspended until Friday or until further orders from the service, an exchange spokesperson told AFP.Both bourses are more than 65 per cent down from their all-time highs in May.”With the US market off five percent overnight and Asia down five to seven percent this morning, things bode ill for the Russian market yet again,” Moscow-based Alfa Bank said in an advisory yesterday.”Meanwhile, damage from the credit crisis and global slowdown is showing up in the real economy” in Russia, including in its important steel and oil sectors, the bank said.On Tuesday, Russian shares appeared to stabilise, with the RTS down 0.95 per cent and the MICEX losing 0.96 per cent on a day in which trading was suspended for several hours to halt a major slide.An announcement Tue
sday by President Dmitry Medvedev that the government was increasing its bank rescue package by 36 billion dollars (26.6 billion euros), failed to materially move the market, Alfa Bank said.- Nampa-AFP