Soros says crisis worst since Great Depression - papers 18 Mar

A century after John Pierpont Morgan rescued the New York stockmarket from a 50% sell off in share prices, his blue-blooded Wall Street bank was yesterday once again at the heart of attempts to contain the deepening global financial crisis, The Guardian reports.

In an echo of the "bankers' panic" of 1907, JP Morgan responded to what is being billed as a meltdown of historic proportions by agreeing to buy its stricken rival, Bear Stearns.

The length and severity of the crisis that broke over global markets last summer has had analysts delving into their history books.

George Soros, who was largely responsible for Black Wednesday, the last bout of serious financial turmoil to afflict the UK, believes there has been nothing to match the events of the past nine months since the Great Depression.

Alan Greenspan, the former chairman of the Fed and the man blamed by many for setting off the boom-bust in the US housing market, agrees with the man who broke the Bank of England. Writing in the Financial Times yesterday, Greenspan said: "The current financial crisis in the US is likely to be judged as the most wrenching since the end of the second world war."

WALL STREET'S LEADING investment banks have rallied around ailing rival Lehman Brothers after the Federal Reserve Bank of New York urged them to support the institution in order to try and preserve financial stability, according to The Telegraph.

It is understood the New York Fed contacted key executives at a number of leading banks, including Goldman Sachs, Citigroup and Morgan Stanley, to discuss Lehman's situation over the weekend.

By yesterday morning, the banks' prime brokerage departments - which service hedge fund clients - were under strict instructions not to do or say anything in the market that could damage Lehman.

THE POUND SUFFERED its biggest one-day fall since Black Wednesday 16 years ago, as traders fretted that a UK bank could be one of the next casualties of the global financial crisis, The Telegraph reports.

Sterling dropped almost 2% against a basket of other leading currencies - its worst day since being ejected from the Exchange Rate Mechanism in 1992. The trade-weighted index finished the day at 93.4 points, the lowest level since January 1997.

HIGH STREET BANKS went with begging bowls to the Bank of England yesterday, seeking more than £23bn in emergency loans as fears over the global credit crunch deepened, according to The Times.

Shares in the banks lost more than £14bn in a brutal day’s trading that pushed the FTSE 100 index to its lowest close in two and half years.

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