As with other articles , the following does not talk about the fallout from the US financial crisis on the War on Terror but without a doubt this could ahve ramafiaction on the WoT
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President Bush has announced a $700bn bail-out plan to mop up toxic mortgage debts in the US financial system.
Markets rallied after Treasury announcement
The cash is likely to come from the country's expanding national debt, which currently stands at almost ten trillion dollars.
Bush is urging lawmakers to move quickly as negotiators from Congress and the White House work through the weekend to thrash out details of the draft bill.
The US Treasury admits the move to guarantee bad mortgages is risky, but says it is necessary to avoid sweeping job cuts and a further housing crash that would cripple the American economy.
Under the taxpayer-funded plan, the government would buy, or commit to buy, "mortgage-related assets from any financial institution having its headquarters in the United States."
Henry Paulson Speech
US Treasury Secretary Henry Paulson has said the government needs to take additional steps to help boost the US financial market - but would have to get Congress' approval.
Read his full speech here.
The plan also calls for a 6.6% increase in the permitted limit of US national debt to $11.315 trillion.
In his weekly radio address, Bush stressed that action was vital, not only for Wall Street but also for the high street.
Further pressure on the nation's financial markets could reverberate and "cause massive job losses, devastate retirement accounts, further erode housing values, and dry up new loans for homes, cars, and college tuitions," he warned.
Elsewhere, Mr Bush said it was a "big package because it was a big problem".
"I will tell our citizens and continue to remind them that the risk of doing nothing far outweighs the risk of the package."
I think we need, at the very least, a return to good old, boring banking
Sky's business editor Michael Wilson reviews an unprecedented week on the markets.
Administration officials and congressional leaders hope a deal can be approved by Congress by the end of next week.
Stock markets around the world soared in value after the US Treasury announced it was stepping in to deal with the crisis.
In London, the FTSE added £103bn to the value of Britain's biggest companies in its biggest-ever one-day rise, while New York's Dow Jones closed 368.75 higher.
Other European stock markets were also in better shape, with Paris's CAC 40 9% ahead, and Frankfurt's Dax 6% up.
Kaletsky On US Bail-Out
But while there is some cause for optimism, Anatole Kaletsky, economic commentator for The Times, told Sky News there could be big problems ahead for Europe.
He said: There are plenty of banks outside the US, including in the UK, which are potentially just as exposed, if not more exposed, to a collapse in the housing market, which is basically what triggered this whole process in the US.
"Now, the fall in the housing market in the US is arguably almost over. In Britain, it's only just started... and the chances are that our housing market will fall at least as much as the one in America.
"Therefore, our banks are equally vulnerable and will need government support."
:: A US bankruptcy court has approved the sale of key assets of fallen US investment bank Lehman Brothers to its British competitor Barclays
Comments
% on to the US national debt - madness! I don't think this can be done in Britain as the public finances won't stand it - we'll have the IMF in like in the 70s!
Posted By :Andrew Report This
this is madness total complete madness america canott keep on printing money it is going to lead to a severe devaluation of the dollar .in germany in the years between ww1 ww2 they tried to print thier way out of trouble it did not work.all paper based currencies fail in the end. the fools on the stock market cheered on friday in a few more weeks they wont be cheering they will be crying hyper inflation is comeing people. even the european central bank is printing more paper as is the uk this is a recipe for complete economic collapse
Posted By :trilegarde Report This
What Happens Though hen People Completely Lose Faith In The Almight Dollar
