“The Bank (of England) Look Like Fools”
The sterling interbank market has collapsed at the fastest rate in modern history.
Office for National Statistics data sourced to the Bank of England shows the volume of market loans in the banking system plunged from £640bn at the onset of the credit crunch in August to £249bn by the end of September, suggesting British lenders have been hit even harder than US banks in relative terms. Total sterling assets dropped from £3,244bn to £2,876bn.
Economists react:
“This is one hell of a shock to the financial system,” said Professor Tim Congdon, a leading monetarist at the London School of Economics.
“A market that has taken 30 years to build has completely imploded in a matter of months. Lenders have been squeezed savagely. We’ve moved into a different era,” he said.
“I regard the Bank’s behaviour as highly irresponsible, neglecting a century of monetary teaching from Bagehot on. It is time for some sense to prevail. The Bank look like fools,” said Patrick Minford, a professor at Cardiff University.
December 3rd, 2007 at 10:00 am
[...] “The Bank of England look like fools.” (Alea) [...]
December 4th, 2007 at 8:38 am
[...] “The Bank (of England) Look Like Fools” [...]
December 4th, 2007 at 8:42 am
[...] palūkanų normas. Bankai nebepasitiki vienas kitu, ir nebenori suteikti vienas kitam paskolų: teigiama, jog tarpbankinė paskolų rinka Britanijoje per kelis mėnesius sumažėjo nuo 640 bGBP iki 250 [...]