Al-Jazeerah: Cross-Cultural Understanding
News, September 2008
Central banks infuse big money to boost confidence in financial market
www.chinaview.cn 2008-09-19 00:45:32
BEIJING, Sept. 18 (Xinhua) --
Major central banks across the world on Thursday acted promptly to infuse thousands of millions of U.S. dollars into the financial market to rescue the battered sector and restore confidence among investors.
According to a statement by the U.S. Federal Reserve, the institution has allocated 180 billion dollars in swap lines, or reciprocal currency arrangements, with central banks in Europe, Japan, Britain, Switzerland and Canada to increase liquidity in the financial market.
Fed also urged major central banks to continue their cooperation and take appropriate steps to address the ongoing pressures.
Global financial markets tumbled after the historical "Black Monday," when one of the biggest U.S. investment bank Lehman Brothers filed for bankruptcy protection, only a day after another financial giant Merrill Lynch agreed to sell itself to Bank of America for roughly 50 billion dollars to avert a deepening financial crisis.
The Fed move on Tuesday to save American International Group Inc., an insurance giant, from bankruptcy by granting an emergency loan of 85 billion dollars. The move, however, did not seem to convince investors that the worst would soon pass.
Major stock indexes across the world continue to plummet Wednesday, with many registering the largest single-day drop in recent years.
It's definite that more drastic measures are needed, analysts said, but none could tell for sure what way may prove efficient and effective.
According to official figures, the Bank of England has provided a total of 25 billion pounds (44.8 billion U.S. dollars) to markets since Monday, and the Bank of Japan also pumped a total of 8,000 billion yen (about 76 billion U.S. dollars) into the markets in recent three days.
Nevertheless, the continuous infusion of money into the markets seemed to work. Stocks jumped Thursday after the previous session's drastic decline, but safe assets such as gold and Treasury bills still saw heavy demand as investors are expecting more instability in the financial system.
Editor: Mu Xuequan
Russia Today, September 18, 2008, 20:39
The Kremlin has been working overtime to restore investor confidence:
President Medvedev on Thursday asked for an injection of $20 Billion to
prop up the financial system.
Wall Street collapses as fears of more turmoil mount
www.chinaview.cn 2008-09-18 05:59:35
NEW YORK, Sept. 17 (Xinhua) --
Wall Street plummeted again Wednesday with Dow Jones losing 450 points, as investors became more worried that the financial crisis would continue to deteriorate.
U.S. stocks Wednesday's plunge was like a rerun of Monday's nose-dive as investors flighted to commodities like crude and gold to seek safety.
American International Group Inc. lost nearly 50 percent in early trading, The world's largest insurer acquired an 85 billion U.S. dollars loan from the U.S. government late Tuesday. In return, the government will get a 79.9 percent stake in AIG and the right to remove senior management.
Merrill Lynch & Co. indexes showed that corporate borrowing costs soared to a record in the United States. Financials were among the worst performers. Goldman Sachs and Morgan Stanley, the two largest U.S. securities firms, tumbled after Oppenheimer cut profit estimates. Merrill Lynch also reduced fourth-quarter profit estimate for Morgan Stanley.
In addition, homebuilders suffered after the U.S. Commerce Department said housing starts slumped 6.2 percent last month to the fewest since January 1991. The reading spurred concern that the housing slump will continue to weigh on the nation's economic growth.
The Dow Jones slid 449.36 to 10,609.66. Broader indexes also end sharply lower. The Standard & Poor's 500 index shed 57.20 to 1,156.39 and the Nasdaq plunged 109.05 to 2,098.85.
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