The market seems to be selling-off on the back of limited bad news imo, apart from the dollar that is.

If you can hold your nerve and apart from any short term requirements to offload poor performing stocks, I have a couple!!, my advice would be sit tight. This does not have the feel of the tech(mining!) bubble at all. Difference being there are a lot of good fundamentals, unlike in 2000 when there were a lot of over rated nothing companies.

UK 3-month interbank lending rate continues to inch higher - AFX


LONDON (Thomson Financial) - The cost for UK banks to borrow money amongst themselves over a three-month period kept rising today, suggesting the credit problems in the financial sector are not improving.

The London interbank offered rate (Libor) fixing for three-month sterling deposits rose to 6.90375 pct, up from 6.89625 yesterday and a full 115 basis points above the Bank of England's 5.75 pct bank rate.

This is the largest spread in 20 years and reflects the fact that banks are afraid to lend to one another as long as it remains unclear who was hurt by the US property market meltdown, and by how much.

The overnight rate eased slightly, to 5.90 pct from 5.91 pct yesterday, a level it has hovered around since last Wednesday, when the BoE said it would boost liquidity in the overnight market.

carlo.piovano@thomson.com

I have remained a bull throughout, i havent panicked, havent sold a single share, always remained positive. I think if more did this, many may not feel like they have been ripped off. I fully understand we are not safe yet and bears could be out in force tomorrow.

"Haven't sold a single share" - But that doesn't mean you are in profit! Could mean any number of scenarios.
The market is very tricky to predict at the moment imo, but locking in profit seems the most sensible way forward at present, I think.

I sort of agree Harry but if in a years time my shares are well ahead of what they were before the 'mini-crash' i can still sell at a profit and much better dealing costs. Experience shows time after time investing should be for the longer term.

WASHINGTON (MarketWatch) -- In the first significant borrowing from the Fed since it lowered the discount rate last month, U.S. banks had borrowed $7.2 billion from the Federal Reserve as of Wednesday, the most since just after Sept. 11, 2001, the Fed said Thursday.
The average borrowing for the week was $2.7 billion per day.
The Fed data don't detail the names of the borrowers. The data indicate that $4.9 billion in loans were owed to the Federal Reserve Bank of New York, $1.6 billion to the Cleveland Fed, and $550 million to the Richmond Fed.

not just nrk

This way UP one day and way DOWN the next is pathetic. What has changed so massively from 3 months ago. The large insutions who can afford to buy a nd sell massive amounts of ftse 100 shares must be raking it in. I bet it will be back up again Monday or Tuesday!

this is all feeling very bad indeed ...... unsure of best way forward; for sure not buying!

totally agree. One moment there is negative reaction to the BOE not intervening to alleviate the credit squeeze; now it has intervened, look what reaction it gets i.e NRK ......

Come come chaps - don't say you weren't well forewarned.


The last time the FTSE100 reached the heady heights of 2006 was in 2000.
The chart below shows what happened then. It took the best part of 3 years before it finally hit rock bottom.
From this, you may well deduce that this months downturn could well be the beginnings of something that will last a while yet.
My own feeling is that the FTSE100 won't begin to recover again until it has first breached 4800 - sometime next year.

Looks like the friend of our ex-PM (or poodle), Bush is to blame for this financial turmoil...


Greenspan faults Bush over spending - AFX


WASHINGTON (AP) - Former Federal Reserve Chairman Alan Greenspan, in his upcoming book, bashes President Bush for not responsibly handling the nation's spending and racking up big budget deficits.

A self-described 'libertarian Republican,' Greenspan takes his own party to task for forsaking conservative principles that favor small government.

'My biggest frustration remained the president's unwillingness to wield his veto against out-of-control spending,' Greenspan wrote.

Bush took office in 2001, the last time the government produced a budget surplus. Every year after that, the government under Bush has been in the red. In 2004, the deficit swelled to a record $413 billion.

'The Republicans in Congress lost their way,' Greenspan wrote. 'They swapped principle for power. They ended up with neither. They deserved to lose.'

In 2006, voters decided to put Democrats in charge of Congress for the first time in a dozen years.

Greenspan's memoir, 'The Age of Turbulence: Adventures in a New World, is scheduled for release Monday. The Associated Press purchased a copy Saturday at a retailer in the Washington area.

The book is a recollection of his life and his time as Fed chief.

Greenspan, 81, ran the Fed for 18 1/2 years and was the second-longest serving chief. He served under four presidents, starting with his initial nomination by Ronald Reagan.

He says he began to write the book on Feb. 1, 2006, the day his successor -- Ben Bernanke -- took over.

The ex-Fed chief writes that he laments the loss of fiscal discipline.

'Congress and the president viewed budgetary restraint as inhibiting the legislation they wanted,' he wrote. '`Deficits don't matter,' to my chagrin, became part of Republicans' rhetoric.'

Greenspan long has argued that persistent budget deficits pose a danger to the economy over the long run.

At the Fed, he repeatedly urged Congress to put back in place a budget mechanism that requires any new spending increases or tax cuts to be offset by spending reductions or tax increases.

The large projected surpluses that were the basis for Bush's $1.35 trillion, 10-year tax cut approved in the summer of 2001 'were gone six to nine months' after Bush took office that year, Greenspan wrote.

There were projections the government would run a whopping $5.6 trillion worth of surpluses over the subsequent decade after the cuts. Those surpluses, the basis for Bush's campaign promises of a tax cut, never materialized.

'In the revised world of growing deficits, the goals were no longer entirely appropriate,' Greenspan noted. Bush, he said, 'continued to pursue his presidential campaigns nonetheless. Most troubling to me was the readiness of both Congress and the administration to abandon fiscal discipline.'

Greenspan, in testimony before Congress in 2001 gave a major boost to Bush's tax-cut plan at the time, irking Democrats. 'The tax cut testimony proved to be politically explosive,' Greenspan wrote.

At that time, Greenspan made the argument before Congress that a tax cut could help the economy deal with sagging growth. The economy slipped into a recession in March 2001. The downturn ended in November of that year.

Surpluses quickly turned to deficits after the bursting of the stock market bubble and the 2001 recession cut into government revenues.

'How could the forecasts have been so colossally wrong?' Greenspan wondered.

Government spending increased to pay for the fight against terrorism and receipts declined because of a string of tax cuts.

As children we emulate the actions of others and try to learn from our mistakes to avoid future pain. Many will have been burned in the past with the collapse of BCCI, LTC and the end of the dotcom boom, not to mention more recent stockmarket wobbles. But could our fear bring about the very cotastrophes we worry about? Just as there was no petrol shortage before long queues formed at the start of the fuel crisis, could we see a similar outcome from queues outside Northern Rock? At a time when liquidity is poor the last thing banks need is people demanding their money back. Only time will tell I guess, but when logic is divorced from reality the strangest things can happen.....

In my opinion.

Strawbs.

D'accord.
Anyone with <30k in there has nothing at all to fear.
The banks problems were caused by not having enough deposited.A media fired scrum outside the branches all asking for their money back can only make it worse.
Still sensible people acting logically and a bank slowly recovering from a world wide problem has never made particularly good headlines, in my very cynical opinion.
Reading some of the media crap in the populist press, one would assume the entire banking system was about to collapse and we would be bartering half a pig for a bushel of corn by christmas. Better headlines but bullshit of the highest order.
The FSA would be well advised to read the editorials and journalistic comments in some of the last couple of days papers and ask what exactly qualifies these people to cause such mayhem.
They would be pretty quick if a bunch of senior financial advisors suddenly started writing popular press painting doom laden pictures of a particular investment, without very good reason.

That's my fear. People's own actions will create a crisis where no crisis (or at least a managable one existed). These actions may bring about a collapse, and then if another bank comes to the BOE in need of short term funding the arguments will be; That's what they said last time and look what happened.... If this scenario actually plays out it could be very very messy indeed.

In my opinion.

Strawbs.

i see your just as optomistic as ever - do you own a gas oven?

The point is that the money NRK have asked for (but not used) is actually nothing to do with covering deposits or anything even remotely like that.
Daft as it seems, NRK are asking for government money, to satisfy the governements liquidity rules, via the FSA.
If that aint circular financing, then nothing is!!
There is no great crisis, other than that of confidence. There will not be a crisis of any financial type unless every deposit in NRK is withdrawn. Even then it would be a fairly small one, covering a few recent retail loans.
NRK has no exposure worth talking about to much other than retail lending and deposits. It is not a Barings or BCCI. It is not Barclays or HBOS. It is a relative minnow that put most of its eggs in one basket.
But read the press and it is the end of capitalism and the begining of financial meltdown. It will be if people are allowed to carry on believing what these tuppence ha'penny journalists write.
It is a self fulfilling prophecy and too many people are gullible enough to believe the nonsense written. If the storm continues and other banks find themselves in a similar position, we can only blame ourselves for allowing The Sun and Daily Mirror to talk us into it, for the sake of a bit of extra circulation.

So far NRK has handled the "run" on the bank far too casually they should have brought in extra staff to get the queues off the streets as quickly as possible in order to restore confidence. I have experienced bank "runs" in Hongkong years ago and the only way to restore confidence is give depositors their funds without delay. It is a waste of resources having staff handing out reassuring leaflets to customers standing in a queue for hours trying to get their life savings back.It is strange that inspite of the tens of millions spent on computer systems this bank has branches that can only process 10 withdrawals per hour as reported on SKY.

No maddoc. Just an electric one. I was just trying to point out that it's often the actions of the crowd that make these problems worse...

Strawbs

strawbs , agree with you entirely , if the Sun & Daily Mirror carrying masses had not rushed for the door there would have been only a minor problem - now i have got a severe headache as i am caught up in a big way in this mess. Spent Sunday going through the small print of nrk deposit conditions and other banks in the firing line instead of doing something i enjoy :-(((

Sadly we're all in the same boat in a strange way. For all I know my bank could be the next one, and despite my worries over the stupidity of crowds, I dare say I'd be queueing to withdraw my cash too. Hopefully it won't come to that though. As I've often observed, we're all guilty of being either too pessimistic or too optimistic at times, and where money is concerned seldom realistic enough.....

Hope your headache isn't too bad.....

Strawbs.

confess i hold AL (bought cos i thought it was a solid defensive banking stock!) and BARC, but with the latest indiscriminate rout of all financial stocks, i just wonder if it makes the likes of BARC, in particular, and perhaps (still) AL a tempting target for one of the overseas banks