Stock market chaos and Job insecurity

The unprecedented fall in stock market has triggered a vicious cycle which we can fairly believe is the outcome of fall of credit system of USA. Under global trade regime no economy may insulate itself from happening in any influential economy like USA.We need to understand the root cause of the whole anarchy.
We all professionally believe that USA regulation is fairly practised and they have more stringent statute to regulate their money market, capital market, and the Banking system, in compare with any other country in the world.Then how come this whole problem originated and how it is contaminating our own system.
Its a social, political economic problem.It start with agenda of providing home to all Americans with inclusive attitude to cover all section of society irrespective of their social status, hence it was started with fair political intention.Since American economy is consumer based highly leveraged economy hence this great American social goal could not be achieved without lenient credit, hence it included the economical commercial participation's.Once the whole idea was looking profitable by over financing to all section of society with political and commercial compulsion, which lead to a situation where it became unmanageable. As the default triggered in mortgage market, the chain reaction initiated and all party concerned in the cycle faced the fate of huge default which leads to liquidation of their assets worldwide.
Back home now we would like to understand how this assets unwinding and liquidation effected our own fate. The Indian economy is largely a capital scarce country from ab initio. We warmly welcomed all the capital inflow after opening of economy in 1991. Largely this inflow had been invested with short term goal and not in core economical perspective.Specially after 2003, as Indian growth story begin to unveil with 8%+ GDP growth projection the maximum inflow started and poured in the stock market with a intention to make quick bucks. The maximum investment came in to India was not having any moratorium on it, about their compulsory lock in clause.They were not having any conviction on the long term fundamental story hence maximum amount was in the nature of vulnerable hot money which may be taken off quickly. The huge investment in the stock of Indian company has given them mammoth market capitalisation and overnight our Business men ranked richest in the world and which prompted them to take extra risk in term of expansion and merger activiteis. The strength could not prevail as the financial foundation was not built on the internally generated resource but it was a euphoria cratered by a short term unregulated money.
The fall of credit market and liquidation of assets of these affected institutions caused a havoc and nightmare as the valuations of companies fallen to its knee which entail low credit availability through any mode of finance be it a venture capital, PE or international money market.
Local company then resorting to unwinding of their extra installed capacity in term of Human resource as soft Target and started retrechment which erupted the high level of insecurity among all concerns.
Moot point
No development is sustainable if it is not financed through its own internal resources. budgetory provision if based on immeginary sitiuation may always cause trade deficit and economical suffering.