Swathes of global banking system to be 'part-nationalised' under G7 plan after Freefall Friday ends FTSE's worst week
Well it looks like 3 trillion US$ have been raised and President Bush has a big smile on his face, yes of course his own money is safe in the bank, lol.
But will the markets cool at least oil looks cooler to day, ops but the suppliers OPEC want to up the price.
G7 countries agree 'plan of action' to rescue world economy
1,048 points - Dramatic fall in the FTSE in just five days
21% - Drop in wealth of Britain's top companies
£250billion - Wiped off the value of your investments
The world's richest countries have agreed a plan to try and stem the financial crisis that saw a catastrophic £250billion wiped off the stock market in the worst week ever for the FTSE 100.
After 'blind panic' set in on the markets on Freefall Friday, finance ministers from the G7 pledged to take 'decisive action and use all available tools' to support financial institutions.
They approved a five point 'plan of action' at crisis talks in Washington which opens up the possibility large sections of the global banking system will be part-nationalised.
Although the details are vague, the plan promises to 'ensure that our banks…can raise capital from public and well as private sources, in sufficient amounts to re-establish confidence and permit them to continue lending to households and businesses'.
This could allow France, Germany, Italy, Japan and Canada to follow the U.S. and Britain in buying up equity shares in struggling banks with taxpayers' money.
Britain announced earlier this week that it would use up to £50billion to recapitalise ailing financial institutions. The U.S. announced it would do the same as part of its $700billion bail-out yesterday.
Political leaders will have to hope this latest co-ordinated action is enough to calm the storm after an emergency rates cut on Wednesday and bail-outs on both sides of the Atlantic totally failed to ease investor panic.
The continuing carnage meant London's bluechip index lost a staggering quarter of a trillion pounds - 21 per cent of its value - in just five days, with similar catastophic falls around the world.More...
- U.S. to buy up stocks in struggling banks for the first time since the Great Depression
- Top Tory William Hague flew off on Barclays £500,000 Italian jolly as markets crashed
- RBS to be first bank to ask for help in £500bn government rescue scheme
- Bank fat cats will STILL receive £3.5bn in bonuses - despite Brown's pledge to slash them
- Cats Protection set to lose £11.2million as biggest charity victim of Iceland bank crisis
- As its share price plunges, is Morgan Stanley next to go bust?
- ALEX BRUMMER: All the old rules have to go
On Monday the FTSE had opened at 4980 points. Last night, it closed at 3932, a fall of 1048.
In Wall Street, the Dow Jones Index has crashed by nearly a fifth since Monday and yesterday President Bush was forced into making his 19th emergency statement since September.
There was another blow for British investors last night when Iceland's Prime Minister said point-blank that his country could not afford to repay overseas investors in its collapsed banks.
The markets meltdown has made the desperate rescue efforts by politicians in both Britain and U.S. look futile.
Last night's emergency international agreement indicates the world may be ready to introduce the kind of sweeping measures Gordon Brown deployed in the UK.
At the G7 meeting, Chancellor Alistair Darling said last night: 'This is a genuinely global problem and we, all of us, all over the world, need to step up to the mark and do something about it.'
But last night a G7 source told Channel 4 News there was no chance of other major countries adopting Britain's £500billion bail-out to prop up inter-bank lending.
The finance chiefs will meet President Bush for further talks on the crisis at the White House later today.