Bail Out goes global

[sunnysan]

Nice, strategy Northern rock goes global

http://news.bbc.co.uk/1/hi/business/7140771.stm


Central banks act on credit fears



The central banks of the United States, European Union, UK, Canada and Switzerland are getting together to help banks deal with the credit crunch.
They are getting together to create a "temporary auction facility" that will allow cash-strapped banks to bid for loans in any of their currencies.
A first auction of $20bn is scheduled for next Monday, with another on 20 December and two more in January.
Banks judged to be in sound financial condition will be able to participate. "The Fed in conjunction with these other central banks is providing a ton of liquidity to the markets by year-end," said Greg Salvaggio at Tempus Consulting. "It will work in the short term as another interest-rate cut," he added.

[milanbenes]

excellent news, we do _not_ need a full blown recession

Milan.

[rootsnall]

_not_

What's going on here ?

[milanbenes]

'cos I want the .Net area to keep strong and folks to have enough money to purchase plan b's products

Milan.

[ChimpMaster]

'cos I want the .Net area to keep strong and folks to have enough money to purchase plan b's products

Milan.

[AtW]

This isn't bail out - this is propping up market with liquidity - if central banks won't do that then banks that need money (but can't get them from other banks) will have to start selling shares and assets - and this will lead to crash in stock market as well as housing market, which would require other banks that did not need money to adjust their balance sheets, declare losses on investment etc.

[milanbenes]

Alexey,

don't worry about the details, whatever it is, it sounds like a good plan and we can all sleep well at night

Milan.

[Dow Jones]

Good man

MB has got the right (positive) attitude for a contractor.
This BTW is not a new thing (banks lending to each other).
NR did that successfully for a no of years (borrowing money at lower IR from the US/Swi/etc at say 4% and lending at 5-6% in the UK).
Could anyone foresee the drying up of markets?
Didn't feature high enough in any RM strategy (10% or so)

(Expect a reply in 30 secs from you-know-who)