No Guarantees That Credit Will Flow After Global Meetings

At the end of a weekend when nearly all of the world's major bankers and finance ministers gathered in Washington to stanch the global credit crisis, there was no assurance that credit would flow when markets reopen this week.

In an effort to get credit moving, European leaders on Sunday promised to guarantee new loans to banks, which have stopped lending to one another as the crisis has deepened. But they left it up to each nation's government to provide details of how its own banking system would be protected. Australia also announced such guarantees, but there was no similar announcement from the United States, where officials declined to say what action, if any, they would take.

Until the credit crisis intensified after Lehman Brothers failed, banks lent freely to each other. This assured that each bank would have money if needed for any number of business purposes, like lending to their clients.

Read the whole story here.

Comments

[StarkRavingNakedEmperor]

ETHYL! WE'RE ALL GOIN' SOCIALIST!

[StarkRavingNakedEmperor]

--"No guarantees that credit will flow...."--

NEOCON DEFINED:

NEO = NEW CON = CRIMINAL

Folks: We've been scre.wed yet again! No thank you ma'am, no dinner, no K-Y!!

[Sundialsvc4]

Ahem...

"Like what, exactly? Have you, for all this time, taken for granted that I am unbelievably STUPID?"

Let us all set aside our "little contretemps" and just talk plainly.

An entire GENERATION of you found your way into the Halls of Congress based on this little fact-of-life that Gen. Dwight D. Eisenhower called "the military industrial complex." He called it a threat. You called it "a business opportunity." You grew fat in a world where people would dig fallout shelters in their backyards because you told them to, and send their children cowering under their desks. NO ONE COULD TELL YOU "NO."

You don't know how to handle "The Huffington Post." Somehow, ARPANET grew into a technology that would allow a little ol' citizen in central Arizona to proclaim (in front of hundreds of thousands of people around the world...) that YOUR EMPEROR HAS NO CLOTHES!

The WORLD really is going to "outgrow" you. Your Cold-War-era debts are worthless, and not even Russia is going to be bound by them.

All you EVER wanted was "more 'CREDIT'" with which to prop-up your imagined empire. You freely sent the industry of your own country to rack-and-ruin in your quest for "dollars for their own sake."

Your own country abandons you. You counted your own country as "a means to your end." But the United States does not take such a view of itself . . .

[FredOCal]

Exactly what is this going to do to restore confidence? Unfortunately, all the money in the world can't make banks that don't know each other's value lend to each other. Until Level 3 assets are fully disclosed, mark-to-market rules are enforced, CDS's are placed on an open exchange, and leverage is reduced to a maximum of 12:1, there will be no end.

[Chavez08]

"STUFF THE BAGS AND RUN BOYS!!!!"

[PT6]

This BAILOUT is the one Obama was instumental in Designing!

McCain thinks he can WIN if the Market Rebounds which it should do now that the WORLD HAS BAILED OUT ALL THE CORRUPT BANKS!

Is this Market Rally the "October Surprise" that Repubs have planned as they always do near an election?

Remember Repubs always "jack up" the market during voting season to give themselves a boost!

Certainly, we must make Point that "MASSIVE COSTS for this BOOST IS BORN BY THE TAXPAYER and MIDDLE CLASS! Demos must "take full credit for any improvements in the market" as we have supported the Bailout at a much higher percentage than the Repubs did.

However, we must be cautious if it continues or watchful if it tanks again to make sure we are supportive.

A sustained run is a benefit for Democrats than it is for the Repubs. Democrats be clear this is what we hoped to achieve!

We must point out that just because Wall Street maybe happy that does not translate to Main Street and McCain is NOT TRYING any more than BUSH to help Middle Class America.

Reform of Washington and Wall Street can not be left in the Hands of the people WHO COST Americans Trillions of dollars for a "FAKE WAR" and a "FINANCIAL CRISIS" like the Great Depression.

Remind Americans they lost $2000 in income under Repubs while gaining $7,500 under Democrats.

Also, Wall Street tends to do better under Democrats than Repubs.

[ahmawally]

CREDIT SUISSE / DLJ MERCHANT BANK WILL BE NEXT TO GO
Credit Suisse's Ex Director/Partner Mr Steven C. Rattner under investigation by FBI/OFC/ATO for tax evasion, prostitution, money laundering and illegal intrusive surveillance and investigations of pivate individuals without their approval and knowledge

http://my.nowpublic.com/tech-biz/credit-suisses-rising-star-forced-resign-over-prostitution-slur

[Jonni Rae]

Just found out today my bank (Soverign) was bought by Spain!!! And that Citizens Bank,another big bank in MA was bought by the UK!! I wonder, does anyone know what this means????

[KillTheMessenger]

It means absolutely nothing. Corporations and banks buy each other every day. Do you know how many banks are being owned in Europe by US firms? Tons. Now you are seeing a few examples the other way round.

[iambusto]

KTM,
you are my favorite poster in Huffpo. finally another poster that actually understands how markets work. !! keep up the good job.

btw, coke just bought a stake (or was it aquisition) in China. I dont see the chinese up in arms over this. on the contrary, we thwaarted chinese bid by CNOOC to buy some oil company (dont remember)

[Tom95134]

The longer that the Bush administration sets around with their finger up their butt the less chance that this will succeed.

[darthdarcy]

This is true simply because the governments will not guarantee the inter bank loans if they'd do this the Spice would Flow..!

"The Spice Must Flow..!"

"I see plans within plans..!"

[Tom95134]

"The Spice Must Flow..!"

LOVE IT!

[geobushono]

The long con continues.......................

[JPHR]

Representatives of the European countries remained polite but once back in Europe disappointment and anger with the US leadership surfaced. The meeting on Sunday 12 in Europe yielded a lot more concrete results. In view of the US causing this mess, exacerbating it by letting Lehman fail, it slow piecemeal response and its ineffectual bad debt buying proposal is ts becoming clear that the market fundamentalist have been resisting recapitalization of banks by the US government taking a stake. Though that 700 billion may seem a lot, it starts to look rather puny in relation to the amounts in Europe.