telegraph.co.uk...The Federal Reserve's rescue has failed - Telegraph

The Federal Reserve's rescue has failed - Telegraph:

The Federal Reserve's rescue has failed

By Ambrose Evans-Pritchard, International Business Editor
Last Updated: 5:46pm GMT 04/03/2008

The verdict is in. The Fed's emergency rate cuts in January have failed to halt the downward spiral towards a full-blown debt deflation. Much more drastic action will be needed. ...........

As the once unthinkable unfolds, the leaders of global finance dither. The Europeans are frozen in the headlights: trembling before a false inflation; cowed by an atavistic Bundesbank; waiting passively for the Atlantic storm to hit........

Section 13 of the Federal Reserve Act allows the bank - in "exigent circumstances" - to lend money to anybody, and take upon itself the credit risk. It has not done so since the 1930s.

Ultimately the big guns have the means to stop descent into an economic Ice Age. But will they act in time?

"We are becoming increasingly concerned that the authorities in the world do not get it," said Bernard Connolly, global strategist at Banque AIG.

"The extent of de-leveraging involves a wholesale destruction of credit. The risk is that the 'shadow banking system' completely collapses," he said.

......??

will vancouver house prices drop? | Vancouver Condo Info

will vancouver house prices drop? | Vancouver Condo Info:

"“I never thought I would see anything like this in my life,” said James Steele, an HSBC economist in New York.

http://tinyurl.com/3ybhng"

FT.com / In depth - Over 1m homeowners get mortgage ‘workouts’

FT.com / In depth - Over 1m homeowners get mortgage ‘workouts’: "Democrats have been trying to advance legislation that would involve a more direct use of taxpayer money to address the crisis, such as giving the Federal Housing Administration $20bn to buy and refinance pools of troubled loans,"

FT.com / MARKETS / Equities - FTSE 100 gives up early gains

FT.com / MARKETS / Equities - FTSE 100 gives up early gains:

"“The oil stocks and the banks are accounting for about these quarters of the losses and overall the market just lacks direction,” said Jimmy Yates, a trader at CMC Markets.

The market was also spooked by rumours of a large foreign exchange-related trading loss at one of City’s leading investment banks.

“Warren Buffett’s comment about the US being in recession were very worrying, as is the continued weakness in the dollar and record commodities prices,” said Simon Denham at Capital Spreads."