Financial markets from Buenos Aires to Caracas reeled as the investors reacted alarmingly in the U.S. and Latin America as Venezuelan president Hugo Chavez’s announcement to nationalize crucial area of economy. Venezuelan financial markets in particular were hit hard as it plummeted steeply as the president accelerated his efforts to move on to socialist reforms. The Caracas stock exchange fell sharply by 19 percent. On the other hand, CANTV was suspended from trading after closing down by 30 percent. The major power company Electricidad de Caracas chopped by 20percent. Hugo Chavez has recently announced that he would nationalize phone and power companies and would assert greater control over four major oil project in which the U.S. and other foreign companies have invested around $17 billion. The Two U.S. corporations AES and Verizon along with some leading petroleum companies have invested heavily in Venezuela whose future is now quite uncertain over compensation. In the meanwhile, the White House reacted on the development saying Nationalisation has a long and inglorious history of failure around the world. Further, it warned that if the U.S. companies are being affected they should be fairly compensated by the Venezuelan government. The entire Latin American financial markets are panic stricken following the developments in Caracas. Some companies have already started to cut their business links with Venezuela.