excellent articles from Oct 2nd

Global banks
On life support
Oct 2nd 2008From The Economist print edition
Governments in America and Europe scramble to rescue a collapsing system




Foreign exchange
The buck swaps here
Oct 2nd 2008From The Economist print edition
Central banks ease the market’s pain


The candidates intervene
Sep 25th 2008 WASHINGTON, DC
From The Economist print edition
The battle to save the financial system has now become part of the presidential race

JOBS will be lost, homes will be foreclosed, America will stumble into a recession and the economy will not recover in a normal, healthy way. All this will happen, Ben Bernanke warned members of Congress, if they do not approve a $700 billion bail-out for the financial sector. Mr Bernanke, the chairman of the Federal Reserve, and Hank Paulson, the treasury secretary, spent this week trying to persuade lawmakers to stump up the cash. But they met angry resistance from both parties.
The plan (see article) is for the Treasury to spend up to $700 billion to buy up mortgage-related assets, with the aim of getting credit flowing again. Given the urgency of forestalling a financial meltdown, a rescue package of some sort is likely to emerge, but the details are unclear. Will the government simply mop up toxic securities, or will it buy equity in ailing institutions? Will Congress sign a cheque for $700 billion, or start with a smaller sum and see how it goes? With the election—for all of the House of Representatives and a third of the Senate, not just for the presidency—barely a month away, no one wants the blame for failing to prevent a deep recession. But no one wants to be accused of showering taxpayers’ cash on bankers in $5,000 suits, either.