Interesting times continue

The Northern Rock bank run continued today. The BBC:

The government has said that it will guarantee all deposits held by the embattled Northern Rock bank. The pledge by Chancellor Alistair Darling is an attempt to reinforce confidence in the beleaguered firm.

More than £2bn has been withdrawn by customers since the bank applied for emergency funding from the Bank of England last week...

Banks are already covered by the Financial Services Compensation Scheme which protects 100% of the first £2,000 in any bank account and 90% of the next £33,000 - giving a maximum payout of £31,700 if a bank did go bust. But under the measures unveiled by Mr Darling, Northern Rock savers would not lose a penny, regardless of how much they had deposited.

The chancellor reiterated comments made by the Treasury and financial services watchdog the FSA that Northern Rock is a solvent business. However these reassurances have not stopped anxious savers from queuing outside branches of the bank to make withdrawals...

And to add to the fun, here comes Alan Greenspan with a warning about the U.K. housing market:

Britain's housing market is heading for a painful correction, according to the world's most renowned economist and central banker.

Alan Greenspan, the former head of America's central bank, the Federal Reserve, issues the prediction in an exclusive interview with The Daily Telegraph today.

He warns of "difficulties" ahead for UK home owners, as rising interest rates bring house price growth to a shuddering halt. -- telegraph.co.uk

When Greenspan was in charge of the Fed, nobody could get him to talk. Now that he's got a book out, you can't shut him up.

Posted by: Old Grouch in In Passing at 22:29:35 GMT | No Comments | Add Comment
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