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Mervy King, Governor of the Bank of England and his position on the recent mortgage crises, rate cuts , moral hazard in the UK economy. Debate about his standing on principle and having to take action anyway as the crisis deepens as at Northern Rock. His approach contrasted with Bernanke's approach to reduce the damage and still focus on inflation. The issues where a principled stand may not be educated enough in the interests of the whole economy, and all the people in society who may be damaged by a principled approach if a crisis has devastating effects on unemployment, investment and confidence; even though some of those who helped build the crisis are helped along the way. Is the idea of a bailout and moral hazard taken at the surface too simplistic in the modern world with the economic fate of all mankind intertwined with the US economy and the other industrialized and leading economies of the world. Is it impossible to punish a few without punishing the whole? Are their other ways those involved would be chastised such as the CEO's of financial institutions losing their jobs, companies losing their reputation, being disciplined as new CEO's like Pandit at Citigroup and Thain at Merrill Lynch provide new leadership? ...

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The WSJ study reported by Carrick Mollenkamp and Mark Whitehouse in the Journal on May 29, 2008, set off the investigation into the lowballing of the London Interbank Offered Rate or LIBOR by the 16 bank panel reporting the rate daily to the British Bankers Association. The rate is critical in setting the interest rate on trillions of dollars in transactions worldwide for securities, home and auto loans, derivatives and swaps. The apparent motive being to prevent negative perceptions of a bank's health if one bank was borrowing at a higher rate than its peers during the financial crisis of 2008-2009. banks doing the most lowballing for the LIBOR rate such as Citigroup, HBOS, were already perceived in financial markets to have higher risk during the financial crisis, divergence in LIBOR rates would reinforce these perceptions. Investigations later showed other banks such as UBS manipulated the rate they reported and influenced other banks to do so to increase trading profits. UBS settled charges for $1.5 billion and Barlays for $450 million. UBS was seen as an egregious offender as the practice was in the words of the Financial Services Authority, the UK regulator, quite "routine and widespread" at UBS....

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Barclays rights issue in 2013 to meet UK regulatory demands. The planned rights issue will raise about 5 billion pounds and will bring the bank's ratio of equity to risk weighted assets to around 9.5%. The Prudential Regulation Authority, a branch of the Bank of England responsible for supervision of British banks, is requiring British banks to hold equity amounting to 3% of total assets. Barclay's leverage ratio is at 2.5%, according to the PRA.

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The Bank of Mexico, Mexico's central bank, cuts interest rates by half a percentage point to 3% in June 2014. The consumer price index is at 3.4% for 12 months through mid-May, and the central bank sees the inflation target of 3% by early 2015 as achievable. The central bank's estimate for GDP growth in 2014 was lowered to 2.8% from 3.5%. GDP growth was annualized 1.1% for the 1st quarter of 2014. Mexico has failed to live up to the growth expectations after the new Nieto administration's efforts to jumpstart the economy and opening up of the state oil industry to foreign investment. The policy changes of the Nieto administration set the future course of the economy and will take time to deliver results in economic growth. More effective administration and execution is needed for economic growth.

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Bank of England's governor Mervyn King disgrees with the Gordon Brown government on the issues of financial regulatory reforms.

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Issues of lack of leadership on climate change that face David Malpass, head of the World Bank are discussed in this report in The Guardian. The Biden administration sees this as a problem because of the need for strong leadership and action in developing countries on climate change, and for financing to support this. Malpass was selected by president Trump for this position and Mr. Trump is known for taking the US out of the Paris Climate change Accords. The climate change related floods, drought and fires in 2022 have created anew awareness of the need for strong action worldwide by all institutions and world leaders.

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Comments in an interview by the World Bank's new chief economist Kaushik Basu on problems for global job creation. He served as chief economic advisor to the Indian government for the last 3 years. He talks of the drying up of trade credit with the eurozone crisis that is hurting exports of developing countries. Basu also emphasizes the importance of addressing the unemployment problems in developed countries. The World Bank's annual development report shows 200 million people unemployed and seeking work globally. And 620 million youth-many of them women- are neither working or looking for work. He is on leave from Cornell University.

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Canada's banks are making investments in US financial firms. Toronto-Dominion Bank agreed to pay $6.3 billion for Chrysler Financial and the Bank of Montreal bought Marshall & Ilsley, a bank in Milwaukee, for $4.1 billion. Investors are skeptical of these deals but experts say Canadian banks have few options to expand except by going to the US market.

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Paletta, Hilsenrath and Solomon give an exceptional journalism report on the silence and tension in the room at the meeting on Monday, October 13, 2008, at 3.00 pm in the Treasury building. It was an historic meeting between Treasury Secretary Paulson, Fed chairman Bernanke, and FDIC chairwoman Sheila Bair on one side, and the head of America's leading banks on the other side. The situation was explained, the bankers asked questions, bankers were not allowed to negotiate, and at one point Bernanke had to intervene saying there was no need for this meeting to have a confrontational tone. Wells Fargo's Kovacevich asked why banks had to accept a capital injection. Kenneth Lewis of Bank of America softened the tone of the meeting by saying that "any one of us who doesn't have a healthy fear of the unknown isn't paying attention." Even before the meeting an anxious John Mack of Morgan Stanley asked Paulson for the reason for the meeting and Paulson told him, "come on down, you will be pleased." John Mack who had fought so many rumors of the firm's demise, was surely pleased with the $10 billon injection of capital in Morgan Stanley by the government in return for preferred share and a dividend of 5%, which helped assure markets about Morgan Stanley's future. Goldman Sach's also received $10 billion. The meeting was ended at 4.30pm. Before this Timothy Geithner, head of the New York Fed, acting as the point man went around handing each CEO a term sheet with a place to sign. Another meeting was setup for 6.30 pm and at that time all the term sheets were returned - and all were signed. There was no meeting. Treasury officials and Fed officials and others had hoped that the intervening time would give CEO's a time to talk to their boards, to think things over, and clear their heads. In a few hours the government took preferred shares in the nation's leading banks and injected $125 billion into the largest banks. Treasury injected $25 billlion in Bank of America, Citigroup, and JP Morgan Chase, And between $20 and $25 billion in Wells Fargo, and $3 billion in Bank of New York Mellon, and $3 billion in State Street. Another $125 billon would be injected into other smaller banks in coming days. Officials at Treasury, Fed and FDIC and other government officials hoped this would give a "confidence shock" to the nation's banking system. ...

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With the Swiss economy experiencing falling wages and prices, fears of a deflationary spiral have led the Swiss central bank to take strong action to preserve export competitiveness. The Swiss National Bank is doing this by buying euros and keeping the Swiss Franc from appreciating above 1.20 euros to the franc, a peg set in Sept 2011. Since 2010 the central bank has printed Swiss Francs to buy euros and other currencies resulting in a quadrupling of the foreign assets it holds to about the size of its GDP- about 500 billion Swiss francs or $541 billion. Action of this size is unprecedented and comes as the eurozone economies contract in 2013. It has worked for 16 months and Switzerland has managed to increase exports to the eurozone and keep the Swiss franc below 1.20 euros. Japan's new prime minister Shinzo Abe is pushing a similiar policy to bring the yen down to 90 yen to the dollar to improve export competitiveness.

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Royal Bank of Scotland (RBS), 83% owned by the British government, reported a net loss of 1.99 billion pounds for the second quarter of 2012. Much of the loss comes from a 3 billion pounds accounting charge for the rising value of the company's debt.