At the end of October 2008, the European Central Bank's (ECB) lending to the banking sector reached the €750 billion mark.
That's a lot of money - over a trillion US dollars - and we are assured by Frankfurt that every cent of it is needed to get the banks lending to each other again. The problem is that flooding the market with liquidity won't work, unless accompanied by an immediate and deep cut in the ECB's lending rate. Why?
The ECB benchmark interest rate is 3.75 percent, and...
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Already a member? Login hereAndrew Rettman is EUobserver's Foreign Affairs Editor. He has been writing about foreign and security affairs for EUobserver since 2005. He is Polish but grew up in the UK. He has also written for The Guardian, The Telegraph, and The Times of London.
Andrew Rettman is EUobserver's Foreign Affairs Editor. He has been writing about foreign and security affairs for EUobserver since 2005. He is Polish but grew up in the UK. He has also written for The Guardian, The Telegraph, and The Times of London.