The crisis is intensifying in Europe, where governments have been forced to prop up several banks in the past week. European leaders are due to meet this weekend to discuss forging a more co-ordinated response, possibly
including a continent-wide bank-rescue fund. And doubts about solvency are spreading beyond banks. After a sharp drop this week in the share prices of large American insurers, such as MetLife and Prudential, they came
under pressure to raise fresh capital as a bulwark against the storm.
构也蔓延开来。在本周股价急剧下挫后，几家大型美国保险商，例如MetLife 和 Prudential迫于压力不得不募集新的资本作为防护堡垒来抵御风暴的袭击。
Until the TARP shows results, the pressure remains on the Federal Reserve to contain the crisis. Ben Bernanke, the Fed chairman and the main driver behind the TARP’s creation, congratulated Congress for demonstrating the “government’s
commitment to do what it takes to support and strengthen our economy”. His language was remarkably similar to what he used, as an academic, to describe Franklin D. Roosevelt’s attack on the Great Depression. Mr Bernanke made it clear
that he included the Fed in that commitment: “We will continue to use all of the powers at our disposal to mitigate credit market disruptions and to foster a strong, vibrant economy.” The Fed has already expanded its balance sheet by around
$600 billion since August, an amount not much smaller than the entire TARP, as it replaces evaporating private credit with central bank credit. The odds are high it will also cut its short-term interest rate, now 2%, to 1.5% either at or before its
policy meeting at the end of October.