The Bank of England together with the central banks of America, Europe, Canada and Switzerland have woken up to the credit crunch crisis, and the dangers that it poses to the world economy. They have finally clubbed together, and will pump in over $110BN into the international money markets in a desperate attempt to ease the credit crisis.
This of course is an admission of failure in as much as it shows that the financial markets are in meltdown, and that the previous individual actions of central banks to catch the falling sword have not worked.
Banks will be able to bid for the money, in the form of loans, to shore up their finances.
Around £20BN will be put into the UK markets.
This should help.
However, it is only one side of the coin, the current turmoil has been brought about by what can only be described as stupid greedy lending by US banks to those least able to afford to be able to repay the loans and the greed of European banks in buying up bundled US debt packages.
Having dug themselves into this mess, the banks then made it worse for themselves by showing a gutless approach to lending to each other; ie they stopped interbank lending.
Fear has gripped the banks and the money markets.
As I have repeated on this site many times, the only way out of this mess is for the banks to show leadership, courage and vision and to start lending to each other again.
The trouble is it seems that there are no banks with such leadership, courage or vision.