Hold tight, the central banks have no plan


	Hold tight, the central banks have no plan

JICWyllie

12-18-2007 12:52 PM

310 views

tags:

economy, currencies, financial markets, i-insolvancy, i-crisis, i-policy, i-inflation, i-increase

JICWyllie says:

The only way out is a significant fall in the material standard of living which can a step towards a better life.

2 Comments |

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12-18-2007 1:01 PM

kmcolo

And this surprises you? One good think about not having a plan, it allows for maximum adaptability.

12-18-2007 2:19 PM

abailart

The UK govt has now pledged £56 billion pounds to Northern Rock. One bank. Would tax payers not prefer some better use to such a massive sum?

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<div style="margin: 12px 0px; font-family: arial; color: #333333; background: #ffffff; border: solid 4px #e5e5e5; width: 100%; clear: left;"><div class="CM_CTB_Content_Wrap" style="margin: 0px; padding: 0px;background-color: #ffffff;"><div style="border-bottom: solid 1px #dcdcdc; white-space: nowrap; margin-bottom: 8px; background-color: #eeeeee ;background-image: url(http://www.clipmarks.com/images/source-bg.gif); background-repeat: repeat-x; height: 24px; line-height: 24px; vertical-align: middle; padding-bottom: 4px; color: #666666; font-size: 10px;" ><a href="http://clipmarks.com/clip-to-blog/" title="see clips that are hot right now"><img src="http://content.clipmarks.com/blog_embed/9d4ebe1e-ebf8-40bb-87d0-399be043e6b9/6F3583DA-2895-4F5C-9B18-6B56F5E7359F/" alt="" width="19" height="19" border="0" style="vertical-align: middle; margin: 0px 4px; display: inline; border: none; float:none;" /></a>clipped from <a title="http://www.ft.com/cms/s/0/233ae764-abef-11dc-82f0-0000779fd2ac.html" href="http://www.ft.com/cms/s/0/233ae764-abef-11dc-82f0-0000779fd2ac.html" style="font-size: 11px;">www.ft.com</a></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.ft.com/cms/s/0/233ae764-abef-11dc-82f0-0000779fd2ac.html"><P>This has been the year when many deeply held beliefs have been challenged. One such belief was that central banks have the toolkit to sort out any conceivable economic or financial crisis. </P><P>Last week’s <A href="http://www.ft.com/cms/s/0/d9e03c62-a8bb-11dc-ad9e-0000779fd2ac.html" title="Central banks step in over credit crisis" class="bodystrong">co-ordinated liquidity action</A> by five central banks taught us that this is not the case. The idea was that a co-ordinated response would reassure the markets, but it had the <A href="http://www.ft.com/cms/s/0/580fcdac-aa6d-11dc-a779-0000779fd2ac.html" title="Overview: Central bank action fails to convince" class="bodystrong">opposite effect</A>. It turned out that market participants are not infinitely stupid. They know by now that this is not a liquidity crisis at its core. If it had been, it would be over by now. </P><P>It is a fully fledged solvency crisis that has arisen because two giant and interlinked bubbles burst simultaneously – one in property, one in credit – leaving banks and investors on the brink of bankruptcy, some hanging on by their fingertips. Yet there is nothing the central banks are offering at this stage to alleviate a solvency crisis.</P></blockquote></div><div style="margin: 0px 6px 6px 4px;"><table style="font-size: 11px;border-spacing: 0px;padding: 0px;" cellpadding="0" cellspacing="0" width="100%"><tr><td style="background:transparent;border-width:0px;padding:0px;">&nbsp;</td><td align="right" style="background:transparent;border-width:0px;padding:0px;width:107px" width="107"><a href="http://clipmarks.com/share/6F3583DA-2895-4F5C-9B18-6B56F5E7359F/blog/" title="blog or email this clip"><img src="http://content8.clipmarks.com/images/c2b-foot.png" border="0" alt="blog it" width="107" height="17" style="border-width:0px;padding:0px;margin:0px;" /></a></td></tr></table></div></div>