Thursday, 30 October 2008

'Global in Nature'

The current financial crisis may be more far-reaching than even the 1929 crash, a Bank of England policymaker has warned.

Professor David Blanchflower a member of the Bank's Monetary Policy Committee (MPC), and has often been a lone voice in urging rate cuts.

"My view remains that interest rates do need to come down significantly - and quickly," Prof Blanchflower told an academic audience in Canterbury.

And Prof Blanchflower said international financial problems could turn out to have long-lasting repercussions.

"It is even possible that this event may turn out to be more significant than the 1929 crash which primarily involved bank failures in the United States," he said.

"The current difficulties in financial markets are more global in nature and more comparable to what happened in the First World War."

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