Continued Impact of the Sub-Prime Crisis on Global Markets
This week has been yet another concerning week for investors around the globe. The week that resulted in the Dow Jones falling a further 697 points. There was also the perceived exposure of banks to the Lehman Brothers credit derivatives increasing to an unbelievable $400 billion.
What are our Governments doing about the Sub-Prime crisis?
This week Alistair Darling, the United Kingdom’s Chancellor of the Exchequer, has been urging the leaders of the G7 to work together to avoid a global recession. Alistair Darling has been quoted as saying “If international cooperation is to mean anything, it means governments have to move on from simply agreeing a general approach, and doing something to resolve the problems we are facing today. We haven’t seen anything like this for generations”. Darling is encouraging the other leaders of the G7 to take a similar government intervention approach to that seen in the United Kingdom, where interests have been taken in financial institutions.
Will the United Kingdom Government need to take Ownership of RBS?
With the collapsing share price of the Royal Bank of Scotland (RBS) there are rumblings of the British Government taking a shareholding in the RBS to help stabilize the market. Nothing at present is confirmed. The rumblings have increased after the 25% reduction in the RBS share price yesterday. This will be an interesting story as it unfolds.
Icelandic Investors panic around the Globe
Panic! Investors in Iceland’s major bank have had a concerning week as the Icelandic major banks and government have struggled with the affects of the sub-prime crisis. Landsbanki which is one of Iceland’s major banks has been working with the Icelandic government to look at possible solutions to the crisis and panic.
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