The blog Gawker.com said it best: "Good Morning, Your Money's On Fire." At least that's what it felt like, to investors who had money in Lehman Brothers, AIG, Merrill Lynch, Citigroup, Goldman Sachs, Morgan Stanley, and so on, and so on. Even buying for pennies on the dollar is a sucker's bet, when a stock can go to zero.
Now, for the Indonesian part of the equation. It's been fashionable the last few years to say that emerging economies have 'decoupled' from the American stock market, and rise or fall on their own merits, not depending on what the Dow Jones Industrial Average is up to. Whoops. Jakarta fell nearly 5% on Monday, a steep drop similar to most other exchanges, as other nations caught the American financial flu and ended up on their deathbeds. Global finance is so interwoven these days, that the idea of decoupling suddenly seems quaint.
So is there anywhere to hide from this global financial storm, which has crossed the Pacific to the Indonesain archipelago? Try thinking of it as Hurricane Ike. Instead of walking right into the storm, get the hell out of the way, and wait until it passes. Anything else is just stupid.
Tomorrow: Indonesia in Elizabeth Gilbert's Eat, Pray, Love ... the Oprah phenomenon
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