Lets push the global economy says Darling and Geithner

March 12th, 2009 by admin | Filed under Daily News, Global Credit Crisis, Money Management, Recession, UK Bank Accounts, UK Banks, World Banks.

In a display of global cooperation and mutual empathy, the leading financial figures in the UK and US government made a simultaneous declaration that called on the West’s leading economies to stimulate public spending in another move to push the global economy out of recession. At the same time, the two global powers agreed to coordinate their efforts to create a whole new set of legislature designed to prevent financial crises of such a magnitude from ever occurring in the future.

The UK and US’s continuing efforts to place a major emphasis on economic stimulus has fallen on deaf ears in the major European capitals, casting doubts about the forthcoming meeting of their colleagues from the Group of 20 rich and developing economies due to take place this weekend will bring any breakthroughs.

Prior to the meeting, Treasury Secretary Timothy Geithner has announced that the United States remained committed to their plan of removing troubled assets from banks while UK Chancellor called for “far greater urgency in dealing with the banks’ problems.”

Another sign that things might be beginning to move for the UK banking system was the queue of investors waiting outside the doors of the Bank of England waiting sell government bonds. The Bank recently launched an innovative programme designed to expand the UK money supply and breathe some much needed life into the economy.

Some of the Britain’s largest investment groups showed their support for the Bank of England’s quantitative easing move. The Bank aims to buy up to £75bn in gilts over the next three months, However early indications that they will be able to buy much more with yesterday’s £2billion target being more than five time oversubscribed.

On the employment front, car maker Toyota has announced their intention to cut working hours and reduce salaries for their UK workers to ride out the dramatic reduction in demand for cars. With this action, the company has join hundreds of companies both in the UK as well as throughout Europe to take up the option of implementing a short-time working program.

Under the terms of an agreement negotiated with trade unions, 4,300 UK workers will work one day less and without pay every two working weeks.

National Australia Bank announced their intention yesterday to maintain their U.K. operations even as the UK economy, especially in the banking sector continues to deteriorate.

The Melbourne-based company, which owns Clydesdale Bank Plc and Yorkshire Bank Plc, said in a strategy briefing today that it remains committed to the U.K. business. The company announced that they will cut their dividend by about 25 percent in the first half of 2009 in an effort to preserve capital.

Clydesdale is one of Scotland’s largest banks operating more than 150 retail branches Yorkshire Bank has more than 190 retail branches throughout the U.K .

Things were quiet on the FTSE after a couple of days of steady increases. FTSE 250 index fell by 0.3% equivalent to 18.17 points to 6008.51 while the FTSE 100 finished the session down 0.27per cent, or 10.11 points, at 3,683.70.

Sterling also remained stable on steady trading, showing as follows:

Pound/US dollar 1.3739

Pound/Euro 1.0745

Pound/Japanese Yen 133,80

Pound/Swiss Franc 1.6435

US shares continued to creep upwards as cautious optimism continued to prevail on Wall Street.

The Dow Jones Average rose 3.91 to close at 6930.4. Nasdaq also rose 13.36 points to 1371.64