US Sub-prime crisis, in fact, has evolved through three phases, sub-prime crisis, liquidity crisis and confidence/real economy crisis which is now and there is no ending seen.
The first phase started from early 2007 when Countrywide first reported that it had to buy back the MBS and incurred huge the loss. It lasted until Bear Stern was forced to marry JP Morgan. The direct impact for global and Chinese investors were very straightforward: any investors who buy these MBS incurred huge losses.
Second phase started after Bear Stern and reached the peak when Lehman Brother filed bankruptcy in mid-September last year. Due to huge losses in MBS, investors and banks were loath to lend money and sell off any investments that they viewed as risky. Also, the rumors were spread as investors were worried about the counterparty risk. Plus, the hedge funds were forced to de-leverage. So the liquidity was dried up. Lehman was the biggest victim of illiquidity. For global investors, they dumped the risky assets and bought the safe assets such as US government bonds (that's called "Fly-to-Safety" t) and hard currencies such as USD, EUR and JPY. Also the "hot money" ran away from emerging market causing big depreciation of these local currencies.
The third phase started from last 3rd quarter when banks needed to conserve capital and cut lending, the crisis spread to real economy. US consumers cut spending. US industry companies cut production and investments. Same story happened in Euro zone. The global commodity prices collapsed, which hurt the emerging markets such as Russia, Brazil, Mexico, Chile, etc. China, which more than 30% GDP came from export, saw the abrupt drop in GDP growth in last Q4.
Hope it will help you!
P.S.: This sub-prime crisis is ongoing now, and cannot be summarized in a few sentence. Above is just my brief personal summary.
[此贴子已经被作者于2009-3-4 6:14:58编辑过]
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