
Comic book: Sun Baoxin, issued by China News Agency during the financial turmoil.
Yesterday, although the European stock market that led to the global "Black Monday" rebounded slightly, in the intensified financial crisis, the rescue measures of European countries "everyone cleans his own door" still worried investors. Although all countries are on high alert, the financial crisis has spread to Europe like a virus.
Although European countries frequently take countermeasures, so far, all countries are "fighting alone" or several countries are temporarily United, lacking overall coordination at the EU level, and it is even more difficult to come up with a 700 billion rescue package like the United States. Analysts believe that given that the European economy is more dependent on the financing of the banking system, if the EU does not follow the example of the United States as soon as possible to help banks get rid of bad debts and ease the credit crunch, the impact of this financial crisis on Europe may even be more serious than that of the United States.
Many people in the industry have appealed that the current financial crisis is no longer a problem that can be solved by a government’s rescue plan. It needs the joint consultation of the main participants in the global financial market.
America
Accelerate the start of the rescue plan, and the Fed’s capital injection will be expanded to 900 billion yuan.
Although the $700 billion rescue plan has been settled, in order to stabilize investors’ confidence, the US government further promised to introduce specific implementation measures for the rescue plan as soon as possible and take a series of practical actions. In order to refine the implementation plan, the Ministry of Finance turned to Wall Street, and planned to hire a number of financial companies to help control the implementation process of the plan, which were responsible for mortgage-related securities and overall loan business. The US Treasury Department announced a series of principles for selecting Wall Street companies and coordinating the interests of outsourcing companies on the 6th.
On the 6th, the Bush administration announced that it had instructed Neil Kaska, Assistant Minister in charge of international affairs of the Ministry of Finance, to lead the temporary establishment of a new department, the Financial Stability Office. Kaska Li, 35, is one of the senior advisers of Treasury Secretary Henry Merritt Paulson. Before joining the Ministry of Finance, he worked for Goldman Sachs. On the same day, the Federal Reserve also decided to start paying interest on bank reserves and announced that it might expand its loan scale to 900 billion US dollars.
At the same time, the Federal Reserve announced on the 6th that it approved Mitsubishi UFJ Financial Group, Japan’s largest commercial bank, to acquire part of the shares of Morgan Stanley in the United States. In a brief statement, the Federal Reserve said that the committee agreed to Mitsubishi UFJ Financial Group to acquire up to 24.9% of Morgan Stanley’s voting shares. As the second largest investment bank in the United States. On September 21, Morgan Stanley and Goldman Sachs, the largest investment bank in the United States, which were seriously affected by the financial crisis, were approved by the Federal Reserve and turned into bank holding companies. In this way, the two companies can set up savings branches to absorb deposits, and at the same time enjoy the financing treatment given by the Federal Reserve to commercial banks.
The "Presidential Financial Market Working Group", including US Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, said that it would "make efforts on multiple fronts" to implement the broad powers granted to the government by the Congressional financial rescue bill.
◎ Europe
Large financial institutions are frequently in emergency, and central banks are busy injecting capital.
Although all countries are on high alert, the financial crisis has spread like a virus. A week ago, European countries were still making suggestions on how to help the United States tide over the difficulties; But a week later, the financial crisis surged, and they were too busy. In the past few days, large European financial institutions have been in a hurry. Fortis Group, a banking insurance giant covering the Netherlands, Belgium and Luxembourg, was officially taken over by BNP Paribas on the 6th. In the same week, the Icelandic government also bought out UniCredit Italy, which has operations in Milan, Germany and Eastern Europe. In Germany, the German government announced last weekend that it would adopt a new rescue plan for the troubled mortgage lender Hypo Real Estate Holdings, with a total scale of 50 billion euros. Against the background of the deepening banking crisis, the European interbank lending market was frozen on Monday.
In the face of the fierce financial crisis, many countries in the European Union have been forced to take "drastic measures" of large-scale capital injection or nationalization in recent days to help their financial institutions tide over the difficulties. The financial situation in Germany is grim because banks and real estate mortgage credit companies have suffered serious losses from the impact of the new round of financial turmoil. The German government has successively introduced many emergency measures to save people’s confidence and maintain financial stability. German Chancellor Angela Merkel said that the government will not allow the plight of a single financial institution to evolve into the plight of the entire financial system. However, German Finance Minister Steinbrü ck admits that saving the German real estate financing mortgage bank is not enough to maintain the long-term stability of the German financial market, which is still in a high-risk period.
British Chancellor of the Exchequer Darling said on the evening of the 5th that he began to consider using taxpayers’ money to provide assistance to troubled British financial institutions on the premise that all parties and central banks in Britain supported the partial nationalization of the banking industry. Although the inflation pressure in Britain is still high, the Bank of England, the central bank of Britain, is expected to make a decision to cut interest rates this week in order to cooperate with the government’s financial rescue plan. Analysts predict that the Bank of England is likely to announce a 0.5 percentage point reduction in the benchmark interest rate to 4.5% on the 9th.
In the face of the financial crisis that spread from the United States to Europe, France adopted a relatively cautious attitude. The French government has always stressed that the French financial system is stable, and the main business of major banks is still savings, while investment banking and subprime lending are not carried out much. Up to now, the French government’s assistance to banks is limited to Dexia Bank, a joint venture between France and Belgium. Large financial institutions such as French Agricultural Credit Bank and Industrial Bank mainly rely on their own strength to increase their capital. France has also taken some indirect measures to help small and medium-sized enterprises and individuals who are in trouble because of the credit crunch. French President Nicolas Sarkozy announced on the 6th that he would not let domestic bank depositors suffer any losses. This means that France will provide full guarantee for personal deposits.
Way out
Individual combat is far from enough. Sarkozy called on the EU to hold a group to save the market.
Although European countries have stepped in to rescue the market, so far, all countries are "fighting alone" or several countries are temporarily United, lacking overall coordination at the EU level. On the 6th, French President Nicolas Sarkozy, who holds the rotating presidency of the European Union, said on the 6th that he would work to persuade other EU member states to coordinate their actions with France, Germany, Britain and Italy in the face of the financial crisis. On the same day, EU member states issued a statement saying that EU member states will take all necessary measures to ensure the stability of the financial system, including injecting funds by central banks, taking measures against individual banks and safeguarding depositors’ deposits. The leaders of EU member states acknowledge that to take these measures, EU countries need close cooperation.
However, this statement does not mean that European countries will work together with Qi Xin to fight the financial crisis. Last week, Ireland took the lead in announcing the guarantee of the safety of all personal deposits of domestic savings institutions. Ireland’s measures initially aroused the dissatisfaction of other EU member states, believing that this scheme would undermine fair competition among banks. Ironically, as of yesterday, Belgium, Germany, Greece, Italy, France and other EU member states have taken similar measures.
At the mini-EU summit held on the 4th, although the leaders of France, Germany, Britain and Italy emphasized that countries should strengthen coordination in dealing with the financial crisis, the meeting failed to change the situation that member countries were "fighting on their own". The leaders attending the meeting rejected the American-style rescue plan and failed to come up with a plan similar to the US$ 700 billion financial rescue plan.
Although Italy, France and other countries tend to rescue the market in a unified way, France even proposed to set up a fund with a total amount of 300 billion euros jointly funded by EU member States to implement a unified rescue plan for troubled EU financial institutions, but under the strong opposition of Britain and Germany, the plan was declared bankrupt. The German government believes that for financial institutions in trouble, they must be responsible for their business activities, and the government should not take taxpayers’ money to save them.
However, at the meeting of euro zone finance ministers held on the 6th, the trend of individual actions by countries has not changed substantially, and the pan-European financial rescue fund widely expected by European financial circles has not yet revealed its dawn. Pedro Sauer Weiss, Spanish Minister of Economy and Finance, said that it is meaningless for the EU to copy the US$ 700 billion rescue plan, but this does not mean that Europe cannot find a joint rescue measure suitable for itself.
Although EU countries have different reasons for refusing to rescue the market, analysts point out that this is mainly subject to the political structure of the EU. Although the process of European integration is deepening, the EU is composed of 27 sovereign countries after all. Based on the different situations of each country, when it comes to vital interests, the first thing that member countries think of is self-protection.
Last week, 10 well-known European economists jointly warned that, in view of the high interdependence among European banks, the strategy of "fighting alone" or "temporarily organizing groups" is still effective so far, but it is far from enough. They believe that only rapid and coordinated actions at the EU level can prevent the financial crisis from getting out of control in Europe, and the EU should make a systematic response to this systemic crisis, instead of rescuing a bank.
Although the market is calling for Europe to rescue the market, a survey shows that most experts in Europe are not optimistic about the formation of a unified financial rescue plan for the European Union. Some analysts believe that the EU has not yet established an integrated relationship in the political and regulatory fields to deal with today’s crisis. At present, the ECB’s power is limited to interest rates and overall monetary policy, but it does not have the power to supervise private banks. (Reporter Sun Juncheng)
Editor: Wang Jiaolong