Need for action on the banking panic Published: September 25 2008 18:10 | Last updated: September 25 2008 18:10 Banks are not to be trusted. This is not just the view of the public and policymakers, but that of the banks themselves. Spreads on unsecured inter-bank lending have reached unprecedented levels, particularly in dollars and, to a lesser degree, sterling. Such stresses cannot continue for long, without serious damage to both the financial system and the economy. Something has to be done. The question is: what? Thursday’s spread over one month between the London interbank offered rate and future expected...
