Re: USA Elections: Candidates Comparison
Wasted155 said:
Well, to be completely honest with you, I'm not sure how the fall/rise in the US market will affect the rest of the world. I'm sure the strenght (or weakness) of the US market will drive, in part, how the rest of the world is affected-- I don't know to what extent.
Here you go mate:
Europe urges swift US action on financial crisis
LONDON: European leaders urged the United States to quickly revive its defeated bank bailout proposal and stabilize the global financial system, as governments across the continent on Tuesday shored up their own banks against the virulent spread of the crisis.
EU Commission spokesman Johannes Laitenberger said that the "United States must take its responsibility in this situation, must show statesmanship for the sake of their own country, and for the sake of the world."
"The turmoil that we are facing has originated in the United States," he added. "It has become a global problem. The United States have a special responsibility in this situation."
Belgium's Dexia bank became the country's second to get a government-assisted bailout in as many days, while Ireland boosted bank stocks by guaranteeing domestic bank deposits. Central banks continued to pump short-term credit into banks in an effort to unfreeze interbank lending.
Still, money markets remained frozen while stock markets seesawed in response to the rejection by the U.S. House of Representatives of a US$700 billion plan to buy bad mortgage-related debts from ailing financial companies. Russia halted trading for part of the day as markets fell.
German Chancellor Angela Merkel called on U.S. lawmakers to pass a package this week, saying it was the "precondition for creating new confidence on the markets — and that is of incredibly great significance."
Christian Noyer, head of the French central bank, said the rejection Monday was "bad news," and added that "the Americans don't have a choice, they must absolutely have a global plan."
In Europe, central banks offered more cash to the market in an ongoing attempt to provide liquidity to the financial system as banks remain unprepared to lend to each other for all but the shortest periods. The Bank of England said it was offering up US$10 billion to a maximum of 10 bidders, while the European Central Bank offered US$30 billion to banks in an overnight operation with a minimum bid amount of US$5 million, and a maximum of US$3 billion.
In Ireland, banks shares surged after the government unveiled an unlimited guarantee on deposits at six domestic banks a day after the Irish Stock Exchange suffered its greatest fall in history. Investors embraced the government's dramatic intervention, reversing most of Monday's stunning stock falls.
Finance Minister Brian Lenihan called on leaders across the 27-nation European Union to follow the Irish example as he also criticized American efforts as too slow.
Dexia bank got an agreement to inject of almost €6.4 billion ($9.2 billion) from Belgium, France and Luxembourg to keep it afloat. CEO Axel Miller — who immediately stepped down — said the bank had no real option to asking for state help because "our feeling was clearly that this week is going to be very tense on the market and we might be ... one of the banks that might be put under pressure."
The Dexia bailout was the latest in a rash of intervention in the European markets since Sunday, the governments of Belgium, the Netherlands and Luxembourg took partial control of struggling bank Fortis NV, Britain nationalized mortgage lender Bradford & Bingley, Germany organized a credit lifeline for blue-chip commercial real estate lender Hypo Real Estate Holding AG, and Iceland's government took control of Glitnir bank.
Europe has no comprehensive plan to rescue its financial systems in the case of widespread banking failures — there is so far at least no equivalent of the rejected U.S. TARP, or Troubled Assets Relief Program.
Global Insight chief European economist Howard Archer said that more cross-border rescues would be needed in Europe.
"In the eurozone, you may well see more of that because some of these banks, like Fortis, are now so big compared to the size of the country they operate in, that governments will have to work together to be able to afford to help," Archer said.
But the EU has so far rejected suggestions of an American-style cross-border bailout fund in favor of a case-by-case approach. French President Nicolas Sarkozy said Monday that there had been "numerous contacts" between different European governments about the financial crisis.
"The situation calls for rapid responses," he said. "Everybody must keep a cool head and have a sense of responsibility."
Sarkozy met with the heads of France's major banks and insurance companies Tuesday to review the state of the nation's financial institutions.
Part of the problem in stopping the contagion in Europe is that the widening spotlight of fear is becoming increasingly indiscriminate. The Royal Bank of Scotland Group PLC, Britain's no. 3 bank with a solid business reputation, was compelled to attempt to reassure investors on Tuesday that it will not be adversely impacted by the government-backed rescue of Fortis after its shares dropped almost 6 percent.
Fortis was part of the RBS-led consortium last year that bought Dutch bank ABN Amro Holding NV for €72 billion, and RBS shares have fallen victim to suggestions that its own ABN Amro assets and planned integration of those assets could be affected.
RBS stressed that Fortis had already paid in full in cash for its ABN Amro stake, which is held in RFS Holdings, the consortium that also comprises Banco Santander SA and that should it sell that holding "the financial consequences would lie with Fortis."
