Increasingly, investors and creditors are losing confidence in the ability of certain firms to meet their obligations leading to a general distrust in the global financial markets. The financial market turmoil has further changed its FACE. It has moved from its epicenter in the financial markets in the US and has begun to affect the US real economy.
Its impact has also now crossed to the financial centers in Europe, as well as the European real economy. Now we are seeing it impact the Emerging Markets. So far, the effect on emerging markets has mostly been on the financial sector, and generally indirect through risk aversion. Indeed, the financial market turmoil has changed into a wider-spread contagion.