From The Daily Mail:
Britain has been sucked into a second credit crunch that threatens the stability of the world’s banking system, Downing Street warned last night.
Central banks from around the world – including the Bank of England and China’s equivalent – yesterday launched a dramatic rescue bid worth hundreds of billions of dollars.
It was agreed to head off a repeat of the 2008 crash when banks simply stopped lending to each other, bringing the world economy to a halt.
The operation, led by the U.S. Federal Reserve, came amid fears that at least one major European bank may be teetering on the brink of collapse and that the eurozone countries could not be trusted to act swiftly enough to solve their problems.
Bank of England sources said last night the money being made available to struggling banks under the new facility was ‘unlimited’. But a similar scheme during the last credit crunch peaked at $583billion (£365billion) in late 2008.
Stock markets around the world rallied in response to the ‘pre-emptive strike’, with the FTSE 100 index closing up more than three per cent.
However, the credit ratings agency Standard & Poor’s downgraded its ratings on 15 global banks – including Barclays and HSBC – by one notch yesterday.
Read more: http://www.dailymail.co.uk/news/article-2068138/Britain-joins-multi-billion-pound-global-bailout-key-banks-face-new-credit-crunch.html#ixzz1fFwzxfgl
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