*Puts on economist hat*

Most people seem to be misinformed about what is going on here. This is to be expected as nobody really knows, but it's pretty obvious (or at least it should be) that the 5% default rate among mortgages in the US is not one of the major problems here.

Pretend for a moment that it was. What does it then say about a global financial system in which a 5% default rate on housing loans can cause complete systematic collapse of the world's major capital markets and their economies?

The fact of the matter is that the Quants have been in an arms race with the rating agencies to obfuscate the true value of the of various forms of derivatives for years. Basically the financial math masters students were defeated by the phds, and now nobody trusts even the AAA tranches in anybodies products.

What this means for the gamming industry is that if this goes far enough noone is safe. Not even microsoft. When people say they are sitting on tons of cash, they don't mean it literally. Gates does not have a huge valt where he swims around in money like duck tales (as far as I know). They have it invested, and probably given their financial savy in something fairly sophisticated which has now become a liability.

Sony is in trouble as they likely rely on access to cheap credit to exist. Nintendo as conservative as they are, are probably in the best situation. However the entire Japanese market is now taking a serious hit with the collapse of the carry-trade.

Nobody is safe, this is why the world's elites are panicking. When was the last time their was 1.5 point, globally coordinated rate cut?

Have a nice day :P

i love asian food and girls. Communism, eh its a worthy sacrifice. Bring it on

It seems recessions are a bit like orgasms then.  Maybe 'hurt' has a different meaning in context though, as in 'Oh Baby, make it hurt.'

the Markets seem stable today..but will it last?

I think the bail-out(s) + government investments are having an effect.

The markets seem not to bad now -- with most markets down slightly... i guess injecting $700 billion US + 250 billion pounds + cutting interest rates 1%(Australia)/0.5%(US/Europe/Canada)/etc + other government intervention is working...

I wonder though how this will effect China -- afterall China is still growing and it looks like countries with strong economic ties to China are doing better than those with strong economic ties to the US or Europe...

As for relating this to games -- It won't effect games in the short term. In the mid term we will see less risky games (as if that isn't already happening). In the long term it won't effect the industry...

Just an FYI not a penny of the $700 billion bailout has been injected.
As mentioned earlier it will take 2-3 months before the first penny in the bailout is spent.
So people need to stop attributing the current state of the market to the success or failure of the bailout...

Success of the bailout was arguably related to the bills passing through congress. That's why they rushed it through. By that measure, to restore confidence, it didnt do shit.

I think the markets are in a position where they are less likely to see major drops because of how many companies can be seen as bargains right now ... There are companies that have a price/earnings ration of 5, and I have seen a couple of energy trusts that are paying out 20% of their price at the moment.

The market can still fall, but I think we're approaching a point where it is more likely that people will shift money from one set of investments to the other.

Goodbye 9000s. Hello 8000s.

The bottom had to be here somewhere. Doesn't there?

I can't go below zero, I think...

It's pretty sad to see GM become a penny stock. They deserve it though because they have made terrible products over the years and did nothing to plan for the future. The Volt is too little too late.