Banks’ £55bn intervention ‘isn’t enough’
The first co-ordinated central bank action since the September 11 attacks drew a muted response from markets as cash-starved lenders called for even deeper intervention.
The US Federal Reserve, the Bank of England, the European Central Bank and two other institutions joined forces to offer over £55bn in emergency loans to the world’s beleaguered banking system. The move also involved swapping currency into US dollars to address shortages of the greenback in the European markets.
Bankers said the move was unprecedented in its scale and reach, exceeding the response to the 2001 terror attacks, when banks acted to prevent the financial markets from grinding to a halt.
But reaction in stock markets was modest, with the FTSE 100 finishing up only 22.9 points at 6559.8. In New York the Dow Jones Industrial Average recovered only a fraction of the near-300 point loss it recorded the previous day, when the Fed disappointed investors by cutting rates only a quarter point.
Reading this post in hindsight with recent events only shows what could of been done in the past.
I hope that the cash injected into the banks from the UK and US governments is enough to relieve the pressures of the economic meltdown.