International markets struggle through another brutal day
The financial crisis in the U.S. continues to send shockwaves through global markets. For the first time since the terrorist attacks on 9/11 governments are considering taking unified action to restore stability. But some countries are not convinced that would work.
After a global black Monday, international markets struggled through another brutal day. In London, New York Mayor Michael Bloomberg placed the blame in part on the U.S. for operating in a bubble.
"We have in America regulation that was written pretty much in a vacuum without considering the rest of the world. And you can't do that in this day and age," said Mayor Bloomberg.
At an EU finance meeting there were reports that several countries are pushing for a globally coordinated interest rate cut. The last time that happened was after 9/11. But Germany is opposed and today Australia took a severe go-it-alone approach, announcing the steepest rate cut in 16 years.
That helped to rally markets in South Korea, Singapore and Taiwan. Experts agree injecting cash to back up banks helps, but a globally coordinated rate cut could restore world wide trust and confidence.
"The solution has to be moves to get banks trusting banks, liquidity, not just liquidity from central banks but movement of funds between banks," said Howard Wheeldon of BGC Partners.
"It isn't that the banks are bankrupt. It is just that there is a lack of willingness to take any kind of risk," said Mayor Bloomberg.
But at least one worst case scenario came true today. The Icelandic internet banking firm ISAVE has alerted 300-thousand British depositors they can no longer withdraw cash.
Information from the Associated Press and ABC NEWS.