The ECB must act now to prevent deflation

The US and Europe are caught on a financial roller coaster. Each day brings a new twist to the ongoing financial turmoil.

First there was the collapse or takeover of some of the most respected banks in Wall Street and the City of London. Now we have the quasi-nationalisation of Fortis Bank in Benelux and the bailout of Hypo Real Estate in Germany, and for the moment much uncertainty surrounds US treasury secretary Henry Paulson's $700bn bailout plan, defeated by the country's Congress....