Opinion | Editorials
Investors are watching as governments try to avert total collapse of financial system
What's wrong with the global economy? No one seems to have the right answer. Governments are pumping in cash to bail out the global financial system.
- Gulf News
- Published: 23:29 October 11, 2008
What's wrong with the global economy? No one seems to have the right answer. Governments are pumping in cash to bail out the global financial system.
More than $8.5 trillion has disappeared into thin air since the beginning of this year. This calls for greater and more coordinated action. Nothing seems to work to stop the freefall of stocks. Efforts by governments and central banks appear to just give temporary reprieve. However, investors are not buying these.
Finance ministers and central bank governors of the G-7 countries said the current situation calls for urgent action. They have agreed to take decisive action and use all available tools to support systemically important financial institutions and prevent their failure. They also are expected to take steps to unfreeze credit and money markets and ensure that banks and other financial institutions have broad access to liquidity and funding. They said they will ensure that the banks and other major financial intermediaries can raise capital from public as well as private sources, in sufficient amounts to re-establish confidence and permit them to continue lending to households and businesses. It remains to be seen if these promises can bring back investor confidence.
More from Editorials
More from Opinions
Opinion Editor's choice
-
No political roadmap for Afghanistan
By Rahimullah Yusufzai, Special to Gulf News
Weak Karzai government does not want Nato to abandon country even after combat troops pull out
-
US campaign to end Israeli occupation
By As’ad Abdul Rahman, Special to Gulf News
It is bound to evoke painful memories of the sordid history in America of the Ku Klux Klan
-
Egypt revolution is far from finished
By Jack Shenker
The Islamist/secularist divide gets all the attention, but it’s also only one faultline among many
Your turn
