U.S. Stocks Up, But Unease Ripples Across Global Markets

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• JIM LEHRER:

  Jeffrey Brown has our recession story.

• JEFFREY BROWN:

  Even as Wall Street opened this morning, there were heavy losses in Asia — Japan's Nikkei index fell 11 percent — and throughout Europe.

  In the era of globalization, the sun never sets on the financial markets, and now the turmoil and fears of a steep recession are worldwide.

  We update the situation with Zanny Minton Beddoes, economics editor for the Economist magazine; Heike Buchter, business correspondent for Die Zeit, a German newspaper; and Susumu Awanohara, a long-time economics journalist and now senior analyst at Medley Global Advisers, an investment consulting firm.

  Heike Buchter, let me start with you and the situation in Europe. Are the problems there because of what's happening in the U.S. or because of problems of their own? Or can those even be separated?

• HEIKE BUCHTER, Die Zeit:

  I would say the problems originated here in the U.S., and that's where — yes, in Europe — or at least in Germany, people are thinking this is where the original sin happened, so to speak, and then it came to Europe.

  But one has to say that the Europeans were ill-prepared. They should have known that this is a global problem and they should have been much more on the lookout for problems in their own banking system. And they just waited far too long to deal with it.

• JEFFREY BROWN:

  And to what extent did the banks there invest in subprime loans and other what turned out to be bad loans?

• HEIKE BUCHTER:

  I mean, the German government just put together a rescue package almost the size of the U.S. It's about $670 billion, 500 billion Euro.

  And that shows you the extent of the government's worry about the banking system. So nobody really knows for sure what's in the balance sheets, but the size of the rescue package is, for German standards, it's enormous.