For as long as anyone can remember the Americans and Brits have considered their financial services better than anything on show in continental Europe.
US investment banks in particular seemed to rule the world. Remember how Goldman Sachs was hired to help sort out Northern Rock? How long ago that seems.
Meanwhile, the City of London has long prided itself on absorbing the best talent from Europe and using their skills to make billions.
But with investment banks now on the verge of a humiliating $700bn (£380bn) bailout and British lenders still too frightened to loan even to each other, the European seems to be in the ascendancy.
Wide gap
The European response to the financial crisis has been led by the European Central Bank (ECB).
Saturday, September 27, 2008
Irish growth tops eurozone league
The Irish Republic's economy continues to expand at a much faster pace than its neighbours in the eurozone despite a housing slowdown, figures indicate.
The Central Statistics Office said gross domestic product (GDP) climbed 6.7% in the six months to June, up from 5.2% in the first half of 2006.
The more favoured growth measurement, gross national product, which strips out foreign investment, rose 5.7%.
The figures are more than double the average across the 13-nation euro bloc.
Economists are predicting that full-year growth will be between 5% and 6%, with a drop in homebuilding being more than offset by a strong rise in commercial property construction and state-funded infrastructure.
The Central Statistics Office said gross domestic product (GDP) climbed 6.7% in the six months to June, up from 5.2% in the first half of 2006.
The more favoured growth measurement, gross national product, which strips out foreign investment, rose 5.7%.
The figures are more than double the average across the 13-nation euro bloc.
Economists are predicting that full-year growth will be between 5% and 6%, with a drop in homebuilding being more than offset by a strong rise in commercial property construction and state-funded infrastructure.
Would a $700bn bail-out end the crisis?
Friday's bounce-back on global stock markets sounded like a sigh of relief at the end of an unprecedented week.
US Treasury Secretary Henry Paulson effectively said that he was sick of dealing with individual banks in trouble and instead was going to bail out the whole system by buying up the toxic debt that is causing all the difficulties.
"This needs to be big enough to make a real difference and get at the heart of the problem," Mr Paulson said.
It is certainly big - there will be $700bn (£379bn) available to buy up debt based on mortgages.
Investors seemed to believe on Friday that the measures would, at least in the short-term, provide some much-needed stability.
"If you look at the reaction in the stock, Treasury and (interest-rate) swaps markets, they're all telling you that this is a good thing and that you're taking some of the fear and risks out of the system," said Mike Kagawa from Payden & Rygel in Los Angeles.
US Treasury Secretary Henry Paulson effectively said that he was sick of dealing with individual banks in trouble and instead was going to bail out the whole system by buying up the toxic debt that is causing all the difficulties.
"This needs to be big enough to make a real difference and get at the heart of the problem," Mr Paulson said.
It is certainly big - there will be $700bn (£379bn) available to buy up debt based on mortgages.
Investors seemed to believe on Friday that the measures would, at least in the short-term, provide some much-needed stability.
"If you look at the reaction in the stock, Treasury and (interest-rate) swaps markets, they're all telling you that this is a good thing and that you're taking some of the fear and risks out of the system," said Mike Kagawa from Payden & Rygel in Los Angeles.
Rush for Bank of England funding
Banks have scrambled for extra funding at this week's regular cash auction by the Bank of England.
Commercial banks asked for £89.2bn ($165.5bn) in the auction - far more than the £52.8bn that was available.
Strains in the money markets have risen rapidly following the collapse of the US investment bank Lehman Brothers.
Banks are turning to the Bank of England for loans because it is currently too expensive to borrow from other banks as they would usually do.
Market stress
The central bank made an extra £5bn available at this week's auction because of the shortage of funds in commercial markets, but analysts said there was clearly appetite for more.
Commercial banks asked for £89.2bn ($165.5bn) in the auction - far more than the £52.8bn that was available.
Strains in the money markets have risen rapidly following the collapse of the US investment bank Lehman Brothers.
Banks are turning to the Bank of England for loans because it is currently too expensive to borrow from other banks as they would usually do.
Market stress
The central bank made an extra £5bn available at this week's auction because of the shortage of funds in commercial markets, but analysts said there was clearly appetite for more.
Lawmakers report progress on financial rescue deal
WASHINGTON (AP) -- Nervously eyeing the markets' next trading session, key lawmakers in both parties and Treasury Secretary Henry Paulson worked late into the night Saturday trying to close an agreement on a multibillion-dollar government bailout of distressed financial companies.
House Speaker Nancy Pelosi, D-Calif., told reporters "quite a bit" of progress was being made on a deal that Congress could send to President Bush as early as Monday after votes in both houses.
A key sticking point was how to include a new government-sponsored program demanded by House Republicans as an alternative to devoting the entire $700 billion proposed by Bush on buying up devalued mortgage-backed securities and other toxic debt from banks and investors.
"We're making a lot of headway; I think it's possible to get this thing done tonight," said Senate Finance Committee Chairman Max Baucus, D-Mont. "I can't guarantee it," Baucus quickly added.
House Speaker Nancy Pelosi, D-Calif., told reporters "quite a bit" of progress was being made on a deal that Congress could send to President Bush as early as Monday after votes in both houses.
A key sticking point was how to include a new government-sponsored program demanded by House Republicans as an alternative to devoting the entire $700 billion proposed by Bush on buying up devalued mortgage-backed securities and other toxic debt from banks and investors.
"We're making a lot of headway; I think it's possible to get this thing done tonight," said Senate Finance Committee Chairman Max Baucus, D-Mont. "I can't guarantee it," Baucus quickly added.
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