The combination of a deteriorating credit market and liquidity strains precipitated the current financial crisis, and the collapse of America’s largest mortgage institutions (Fannie Mae and Freddie Mac), and globally important investment banks such as Bear Stearns, Lehman  BIS Review 25/2009  1  Brothers and Merrill Lynch.
The resultant crisis has also led to panic selling in financial markets and a remarkable response by central banks. Ladies and Gentlemen: The current concern for most Kenyans and investors is the extent to which the contagion of this global crisis will affect the domestic economy. Among the questions being asked are: how will the domestic economy be affected?