October 7, 2007 (LPAC)--Britain's insolvent Northern Rock Bank has now borrowed almost 11 billion pounds ($22 billion) from the Bank of England, but its fate is still unclear. The Times of London reports that Citigroup is prepared to lend Northern Rock another $10-20 billion. But Northern Rock last week scrapped two-thirds of its mortgage products because it can no longer finance them. The JC Flowers and Cerberus funds are exploring purchase of Northern Rock, but only if many more billions are injected into it first.

As long as the Northern Rock problem is unresolved, it threatens to bring down the whole British banking system, as economist Anatole Kaletsky wrote in the London Times on Sept. 17, under the heading, "I hope I'm wrong, but I've a very bad feeling."