Changes

In [[Germany]] Hypo Real Estate was given €50 billion euros ($68 billion dollars) bailout by the government.  The government of [[Iceland]] took over its large banks, as the entire island economy verged on bankruptcy because it depended so much on large foreign loans. Most of the European countries hurriedly announced guarantees of personal bank deposits to avert further drop in consumer confidence and runs on the banks.  Stock markets around the world continue to decline as pessimism worsens.

In [[Germany]] Hypo Real Estate was given €50 billion euros ($68 billion dollars) bailout by the government.  The government of [[Iceland]] took over its large banks, as the entire island economy verged on bankruptcy because it depended so much on large foreign loans. Most of the European countries hurriedly announced guarantees of personal bank deposits to avert further drop in consumer confidence and runs on the banks.  Stock markets around the world continue to decline as pessimism worsens.

The European Central Bank aggressively lent money to banks trying to ensure that banks would have adequate cash. The moves have not reassured savers or investors, and European stock markets have fallen even further than the American stock markets, as have the stock markets in China and Russia.  The leaders of France, Germany and Italy vowed to prevent a Lehman Brothers-style failure in Europe but they did not offer an American-style bailout package.<ref>Carter Dougherty, Nelson Schwartz and Floyd Norris, "Financial Crises Spread in Europe," [http://www.nytimes.com/2008/10/06/business/06markets.html?_r=1&hp&oref=slogin ''New York Times,'' Oct 6, 2008]</ref>

The European Central Bank aggressively lent money to banks trying to ensure that banks would have adequate cash. The moves have not reassured savers or investors, and European stock markets have fallen even further than the American stock markets, as have the stock markets in China and Russia.   

 

On Occtober 13, France, Germany, Spain, the Netherlands and Austria committed €1.3 trillion euros ($1.8 trillion dollars) to guarantee bank loans and take stakes in banks, in an emergency effort to head off the collapse of their financial systems. <ref>Carter Dougherty, Nelson Schwartz and Floyd Norris, "Financial Crises Spread in Europe," [http://www.nytimes.com/2008/10/06/business/06markets.html?_r=1&hp&oref=slogin ''New York Times,'' Oct 6, 2008]; Gregory Viscusi, [http://www.bloomberg.com/apps/news?pid=20601087&sid=azerJ573HcbI&refer=home "EU Nations Commit 1.3 Trillion Euros to Bank Bailouts," ''Bloomberg.com'' Oct. 13. 2008]</ref>

Britain on October 8 announced a gigantic £400 billion ($680 billion) rescue plan for its banks; the government would partially own them.  Prime Minister [[Gordon Brown]] said banks would still be run by their old managers, but that the government would have to be "satisfied" on matters of salaries, [[dividend]]s and lending activities.  The money involved is about a third of Britain's annual [[Gross Domestic Product|GDP]] (comparable to $5 trillion in the U.S. economy.)

Britain on October 8 announced a gigantic £400 billion ($680 billion) rescue plan for its banks; the government would partially own them.  Prime Minister [[Gordon Brown]] said banks would still be run by their old managers, but that the government would have to be "satisfied" on matters of salaries, [[dividend]]s and lending activities.  The money involved is about a third of Britain's annual [[Gross Domestic Product|GDP]] (comparable to $5 trillion in the U.S. economy.)