Analysts says that if there are no actions taken, England may end up like US with a financial and economic crisis. They think that the England government may use 200 billion pounds to save the market.
People from the England finance department says that currently there are no plans like the US to save the market but they are ready to take any necessary actions to stabilize the financial market.
From media reports on the 22 September 2008, after the US government's plan for a 700 billion USD plan to save the market, England's government may consider using 200 billion pounds to help the banking industry who are in a bad situation. The England government has not denied that they will not follow the footsteps of US but at the same time mentioned that currently they have no official similar plans.
Yesterday, JP Morgan says that out of capital concern, it has lowered the ratings for the England banking industry.
Situation Worsened Last Week in England
Currently England is facing the same continuous rising large amount of bad debts and huge decline of housing prices and in last week the situation has worsened. England's central bank monetary policy committee previous committee member and economic analysts from Citi and UBS says that the England government has a need for a similar plan like the US to save the market.
London's school of political economics professor Buiter says that England will soon have a similar plan like the US in the bailout of bad investment assets by tax payers in US.
UBS economic analyst says that if the liquidity assets, non-performing assets and similar problems are not resolved in time for banks, then other countries including England should consider a plan similar to that of US.
Citi's England economic analyst Michael Saunders says that from the looks of the movemets by the England's government lately, the actions taken are mostly to ease the market such as providing emergency liquid assets, stopping of short selling and others. Time can let the financial system recover stabality but the whole system does not have the self-stabalizing capabilities.
England's Finance Department Says It Is Prepared
England's central bank on April came out with a special liquidity plan to inject liquidity into the financial system. It can be foreseen that to come out with any such plans will cause the plan's amount to increase each time. The plan used over 100 billion pounds but analysts says that the figure will definately go over 200 billion pounds.
To such comments, the England's finance department says that England currently is not considering plans similar to that of US. But at the same time, the senior officials and the prime minister has clearly mentioned that they are prepared to take any actions to stabalize the financial system.
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