Gosh, this is in parts sad and frightful - Bank Borrowing from ECB is Out of Control. (ECB = European Central Bank = Europe's Federal Reserve) I only point this out because the financial problems are both global in nature and we are doing the EXACT same thing here. When these "crutches" first come out we are told, oh it's just for a few weeks or months. Then they get extended until "things get better". But what's half a trillion among friends? (Dec 18: Libor Rates Plummet on Half a Trillion Infusion by ECB) These central banks truly have developed a nanny state - just imagine if your small business was faltering - no one comes to your rescue...

• The European Central Bank has issued the clearest warning to date that it cannot serve as a perpetual crutch for lenders caught off-guard by the severity of the credit crunch. Not Wellink, the Dutch central bank chief and a major figure on the ECB council, said that banks were becoming addicted to the liquidity window in Frankfurt and were putting the authorities in an invidious position.
• "There is a limit how long you can do this. There is a point where you take over the market," he told Het Finacieele Dagblad, the Dutch financial daily. "If we see banks becoming very dependent on central banks, then we must push them to tap other sources of funding," he said. (Please send that memo to Uncle Ben)
• While he did not name the chief culprits, there are growing concerns about the scale of ECB borrowing by small Spanish lenders and 'cajas' with heavy exposed to the country's property crash. Dutch banks have also been hungry clients at the ECB window. (Remember Spain has just about as bad, if not worse, housing situation than we do - they, unlike the Germans or French, drank the United States Kool Aid of "lightly regulated markets will take care of themselves" and "0% down for $350K homes! Works like a charm!")
• ...over-reliance on the ECB funds has become an increasingly bitter issue at the bank because the policy amounts to a covert bail-out of lenders in southern Europe. (my suggestion is take the American way and just make it a 'plain in sight' bail-out.