Monday Morning Potpourri
October 13th, 2008 7:50 am | by John Jansen |Libor set this morning ( three month) at 4.75 percent. On Friday it had set at 4.82 percent.
Central banks in another coordinated effort have agreed to provide unlimited amounts of dollars (against the appropriate collateral) to the markets. This is via the Swiss National Bank, the Bank of England and the ECB. Thank you to reader Milton Arbogast who mentioned that in a comment on a previous post.
Her Majesty’s government has responded to the crisis of confidence in the banking system with an infusion of 37 billion pounds. The government has forced some banks to suspend paying dividends on stock. The government will take seats on the boards of some companies. The FT reports that it is possible that the government could own 60 percent of Royal Bank Scotland and 43.5 percent of the LLoyds HBOS entity.
Press reports indicate that the German government will announce a bailout package of 470 billion Euros later in the morning. The German proposal will guarantee lending between banks. Details of French and Italian proposals are expected later this morning. This FT story is a good summary of various proposals and actions by governments and central banks around the globe.
The US government, according to the New York Times has assured Mitsubishi that its $9 billion investment in Morgan Stanley will be “protected”. The writer at the Times rightly describes the move as “extraordinary”.
The markets await details of proposals on recapitalization of the US banking system.
2 Responses to “Monday Morning Potpourri”
By Doug on Oct 13, 2008 | Reply
Putting the “Royal” back into RBS.
ps Paul sent me.
By anon on Oct 13, 2008 | Reply
It looks like the European countries will spend much more (for the moment) per capita in an attempt to recapitalize their banks. I can’t see this as good for the Euro.