Thursday, October 9, 2008

Update: Economy still shitty

Posted on Thu, Oct 9, 2008 at 11:36 AM


I know it's been a while, since yesterday's attack on our server by commies eliminated a couple of my blog posts and a bunch of your comments (awww), but we plugged back in this morning and quickly checked on the state of things ... and it's still really awful.

CNBC reports:

Three-month borrowing on interbank markets remained expensive near this week's highs across all currencies, and lending beyond a week or two remained frozen, traders said.

Acting piecemeal, they have rescued banks, injected massive amounts of liquidity into the markets, agreed to take toxic debt off the books of financial institutions and now, in unison, have slashed interest rates in the face of the greatest financial crisis since the Great Depression.

That has raised the question of what options remain to combat the market meltdown, which has destroyed lenders from Wall Street to Iceland to Germany and left people worried about the security of their savings and jobs.

"The rate cuts are a good step in the right direction to stop the bleeding, but this won't be enough," said Rik Zwaneveld, trader at AFS Brokers, in Amsterdam. "European governments have to act swiftly and decisively together."

Treasury Secretary Henry Paulson, speaking to reporters on Wednesday, stressed that the recently approved $700 billion financial bailout bill gave him wide authority to inject capital into the banking system, and he said he would not rule out having Treasury take an ownership position in banks if necessary.

"We will use all the tools we've been given to maximum effectiveness, including strengthening the capitalization of financial institutions of every size," he told a press conference.

Wow. he said "tools" and "every size" in the same sentence. That's what I take from everything above, which says a lot about me, I think.

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