Funny how to think of it that way when Batman and Robin kiss someone else's foot or maybe Superman himself kissing the floor; superheroes losing in a battlefield. But what makes it more convincing is when you put it in reality, restating it to a bigger and serious matter. Just think of it, the United States of America, home of the powerful busniessmen, place where technology is born, where the richest bank are held, ideal federal country, suddenly slipped its way on the ground.
Last September of this year, i.e. 2008, a chaos once again trembled the sidewalks of Wall Street in New York when, suddenly, major international and local financial institutions dropped massive points in the stock market. But, how can such a powerful country just unexpectedly lose in a game he is best at? How did the United States just suddenly lose its charisma in the world of Economics?
Before the crisis happened, the US market was relatively stable. It was normal, the stocks exchange rates fluctuated conventionally. Come September 17, 2008, Wednesday, after singer-actress Christy Carlson Romano performed at the NYSE (New York Stock Exchange), Wall Street went into choas. Dow Jones & Company, a printing and financial firm under the supervision of News Corporation after it was taken over in 2007 from its founder Charles Dow and Edward Jones, suddenly dropped 450 points. For a company to lose this huge amount is really gonna send negative feedbacks. Normal downfall rates are at 1-5 points. but dropping a 450 is really something people must pay attention. This was considered as the most disastrous event that ever happened in the US Economy after its 2001 recession. Other notable companies like American Express, Citigroup, JP Morgan Chase & Co., and even Apple Inc. dropped points. Lehman Brother's Holdings Company filed a bankruptcy that sent impressions to both local and international firms. In general, Wall Street lost thousands of points in the World Market.
Reports said that this event was caused by the household firms, also called as the "sub-prime market", with major credits and loans to these banks haven't eventually pay their debts, including countries and other financial institutions. Other factor that affected the sudden drop was the rise on the unemployment rate in the US, amounting to 6.1%.
Following these events, the Federal Government came to the rescue by giving an aid with a total of seven hundred billion US dollars ($ 700 billion). This was initially rejected by the US Congress. Other financial institutions and countries gave their assistance to regain the losses.
In the Philippines, stock markets was also affected. Starting of first with the import goods coming from the US. There are goods and services that only US have. Let's say for example, computers. We need computers in order for us to accelerate things up and maximize the time for working. Since the Philippines do not produce computers, we import from the US. Since the US is having their economic downfall, they can increase the price of the computer. Our country can't do anything about it but just buy the computer at any cost instead of having none at all. In the end, we are still the losers. I was just went sceptical when Ambassador to the Philippines Kristie Kenny said that the Philippines would not be that affected much of the US Economy. In a press release, Senator Angara said that "the government must strengthen its macroeconomic policies both by rationalizing fiscal incentives and curbing tax evasion". Looking into the world market, most countries also lost points due to the US economic crisis.
Well, I guess this is a lesson for all the government people out there to tighten up their belts when it comes to economic policies. They must set aside their pride and see the reality behind these events. They must act NOW and not waste time debating such unscrupulous things.
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