Presented By: Raman Preet Singh

Presented by: Raman Preet Singh

HOW IT STARTED

?



In US



The Epicenter Sub-prime Mortgage Crisis Created fundamentally by the government policies and institutions. Quasi-Government companies: Fannie Mae and Freddie Mac

 



 





Lehman Brothers bankruptcy Sale of Merrill Lynch to Bank of America AIG demand of loan from the federal reserve Created panic in WALL STREET and throughout the global indices

DOW JONES

FTSE-100

US

11,543 8,451

UK

5,636 3,932

CAC-40

NIKKEI

FRANCE

JAPAN

DAX

SHANGHAI

GERMANY

6,422 4,541

RTS RUSSIA

CHINA

2,397 2,073

SENSEX INDIA

4,482

13,072

1,646

14,564

3,176

8,276

792

11,309 *29th Aug – 13th Oct

OTHER CONTRIBUTING FACTORS   



High prices of basic commodities Inflation Unemployment: ILO predicted 20mn jobs lost by 2009 end High price of oil

EFFECTS on INDIA

 “IF

THE GLOBAL FINANCIAL CRISIS CAUSES A RECESSION IN THE MAIN ECONOMIES, THIS WILL COMPROMISE OUR EXPORTS.” ►MANMOHAN SINGH Prime Minister, in an interview to an French daily

le Figaro

EFFECTS…       

Credit crunch Lesser exports Decreased production Lesser investments Declining sales Falling rupee Sluggish real estate to affect demand for cement, steel and other construction materials

THE BIG FALL  



  

MUKESH AMBANI RELIANCE INDUSTRIES 59.23 -54% 26.87 AZIM PREMJI WIPRO 15.18 -55% *1

st

6.76 Jan- 8

th

Oct

  

  

K P SINGH DLF GROUP 40.81 -76% 9.57

ANIL AMBANI RELINCE ADAG 41.85 17.47 -58% *in$billion

GOVERNMENT ‘S ACTION…    



Provide liquidity Attract investors Avoid rumors Control basic factors as inflation(8%), repo rate(6.5%), reverse repo rate(5%), CRR(5.5%) Prevent rupee depreciation