United States Warns of Further Bank Failures

The US treasury secretary has warned some banks will still fail despite the $700bn government rescue package to shore up the financial system. Henry Paulson called for the plan's swift implementation, but said the financial crisis would not end soon. Seven central banks on Wednesday cut interest rates in an effort to steady the faltering global economy. But the moves failed to cheer world stock markets, and Thursday saw sluggish sales on Asia's main indexes. Japan's benchmark Nikkei index was volatile on Thursday, having suffered its biggest one-day drop in 21 years the previous day shedding nearly 10% of its value. By lunchtime, it had regained early losses, 1.25% up. The Bank of Japan announced it had injected two trillion yen ($20.1bn) into the money markets in an effort to calm fears. In Sydney, Australia's financial market lost ground in early trading. South Korea's stock market also eased slightly after posting an initial gain, and the central bank announced a cut of 0.25% in its key interest rate, taking it to 5%. Global action In his bleak assessment, Mr Paulson warned the ongoing financial chaos had "seriously impacted" the economy. "Even with the new treasury authorities, some financial institutions will fail," he added. There was an equally stark warning from the International Monetary fund, which said global financial markets were facing their most dangerous shock since the 1930s. In an unprecedented co-ordinated move on Wednesday, rates were cut by the Bank of England (to 4.5%), the US Federal Reserve (to 1.5%), and the European Central Bank (ECB) (to 3.75%), with similar cuts from the central banks of Canada, Sweden and Switzerland. Traders on Wall Street Wednesday's co-ordinated rate cuts surprised many traders Although it did not cut its own rate - which is just 0.5% - the Bank of Japan expressed its "strong support" of the policy. In a separate move, China cut its own interest rate by 0.27%. While European and US markets initially reacted well to the news, they later lost ground as investors were unconvinced the rate cuts were enough to solve the financial crisis. In New York, the main Dow Jones stock index lost ground for its sixth consecutive session, ending 2% down. The heads of the IMF and the World Bank are due to discuss the world's ongoing financial turmoil in Washington later, and finance ministers from the G7 group of industrialised nations are meeting later this week.

Source

Great looks like the bail-out (the solution for all our problems) isn't really the solution ... and that banks will be failing and that us still is goin down the tubes...... i wonder are they trying to make people worry because i think it's really starting to set in ... and if this plan isn't going to work are they going to propose a new one? if they are is there going to be more money requested from the taxpayers???? (they being the legislative/executive branch)



[edit on 8-10-2008 by baseball101]

Here are his specific remarks:



This isn't over by a long shot.

[edit on 8-10-2008 by loam]

reply to post by loam


thank you for the video and definitely ... the outlook is not looking good for us in the states ... i wonder they will try and do to solve it? create a new bail-out ... all i can say is whoever may be elected as president will have a s___ ton on their plate as soon as they enter the white house

Seems the plan is for a controlled slide, coordinated world-wide yet diversified in terms of particular capital flow mechanisms, with punctuated events and digestible explanations, to avoid triggering forward-feedback loops in automated market trading systems.

Bumpity-bump-bump-bump....

Edit: what's that numb feeling? It's your butt, as you slide down the stairs...


[edit on 8-10-2008 by Ian McLean]

More banks NEED to fail. They are already staring insolvency in the face and the only thing keeping them afloat right now is the fact that they fudge their books to make it look like they're not insolvent.

We NEED the deadwood cleared before we can even think about heading towards a recovery. If the bad banks don't fail, we're going to be stuck in a neverending rut of credit freezes, market chaos, and endless bailouts.

Let NCC fall. Let WB fall. Let C fall. Let all the craphouses collapse so we can pick up the pieces and start rebuilding.

reply to post by anachryon


ahh yes it would be nice if all people thought like this ... but don't you think that if a lot of banks failed that the general public would lose trust in the banking system??

"Canada did have some advantages over other countries, especially its extremely stable bank system that had no failures during the entire depression, compared to over 9,000 small banks that collapsed in the United States."
SEND YOUR MONEY TO CANADA!
OH CANADAAAAAAAAAA!!!!! WHERE THE BANKS DON'T FAILLLL!!

reply to post by baseball101


Did they lose trust in the banking system after the 30s? After the 80s/90s?

J6P can't help but be aware of the turmoil right now, and even if he doesn't understand the details, he knows the banks screwed up. Some banks screwed up worse than others.

I think if there was a concerted effort to educate the American public at large as to exactly what happened here, there would be no trust lost. The good banks would survive. Everyone understands "only the strong survive," right? Well, if Citi falls and Chase stays afloat, with proper education it should be easy enough to understand that Chase is a good bet to hold on to one's paycheck.

I really can't imagine the public as a whole is completely dumb.

reply to post by anachryon


true i guess if there was some sort of education put out there...i'm sure there would be some sort of propaganda put out by the government ... haha i'm not sure i know some people who had no clue what was going on with the whole financial crisis ... i don't know i guess most people wouldn't really care if it didn't affect them directly...

reply to post by loam


your video is no longer working ... weird i edited to put the video in the OP so thank you loam for it .... so what does everyone think will result? a new bail out? demanding more money?

edit: ya i realize that now it works on youtube for me but not on ats

[edit on 8-10-2008 by baseball101]

reply to post by baseball101


That's strange... It still works at youtube.

www.youtube.com...


[edit on 8-10-2008 by loam]