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Paulson Plan Mega Bailout for British Banks

Sept. 26, 2008 (EIRNS)—Just as Lyndon LaRouche has warned, the mega bailout plan of U.S. Treasury Secretary Hank Paulson is a big give away to bailout the Her Majesty's banking system. Today's Times of London, the mouthpiece of the British establishment, which now reports that the five top British banks could grab as much as 25% of Treasury Secretary Hank Paulson's $700 billion mega bailout plan. British banks hold no less than $175 billion (95.3 billion pounds) of "distress assets."

"If the British banks tap the rescue fund," writes The Times, " being set up by the U.S. treasury and the Federal Reserve to the maximum, they could secure one quarter of the $700 billion being made available." The breakdown of what these banks are holding is the following: HSBC, the flagship of the British Empire, holds 45 billion pounds; Barclays, 17.4 billion pounds; Royal Bank of Scotland, 16.2 billion pounds; HBOS, 13.3 billion pounds; Lloyds TSB, which now owns HBOS, 3.4 billion pounds.

Another confirmation that the British Banks are nothing more than Zombies is that fact that the Bank of England announced this morning it will be pumping an addition 55 billion pounds into the financial system. Included is an offering to lend $30 billion in U.S. dollar funds for one week.

The first such operation will be an auction for 40 billion pounds maturing on Thursday Jan. 15, 2009, an obvious move to get Britain's Zombie banks past the last quarter. The BOE will be accepting mortgage backed securities as collateral. This operation is being coordinated with the European Central Bank, the Swiss Central Bank and the Federal Reserve. The Swiss are offering $9 billion which the ECB is offering $35 billion.