Dollar Falls on Recession Fears and Possible Rate Cut
As Congress debates the merits of Bush’s $700 billion bank bail-out plan, more signs pointing to a long and painful recession prompts talk of a rate cut at next months Federal Reserve meeting.
LIBOR Rates Continue to Rise
Fears of further delays or even a rejection of the U.S. Treasury’s bank bail-out has some banks holding on to reserve cash thereby reducing funds in the overnight lending market. This has pushed the three-month London Interbank Offered Rate (LIBOR) up another 32 basis points.
President Bush Describes Bail-Out Package as a “Tough Vote”
Despite continued discussion and passionate speeches from both sides of the debate over the merits of the $700 billion bank rescue package, it appears that a deal is close to being signed. It appears that several amendments – including one that limits executive compensation and provides additional protection for taxpayers and homeowners – have been written into the bill to be presented to Congress.
FSA Fines Subprime Mortgage Lender
The Financial Services Authority (FSA) – the U.K.’s main financial services regulator – fined a subprime mortgage lender G.E. Money 1.12 million GBP for overcharging hundreds of borrowers.
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