November 27, 2007 (LPAC)--Responding to desperate calls on Nov. 26 from banks and stock brokerages, that "the central banks must do something more dramatic" about the credit markets' collapse, the European Central Bank (ECB) today granted a huge infusion of bailout cash to the banking system, a weekly tender of 178 billion euros ($260 billion) to the European Union's troubled banks. To give readers some perspective on this, this is approximately double what the U.S. government will pay for the Iraq war in all of 2007!

This massive injection is due to be repaid after seven days, but, the ECB has found banks reluctant to pay back recently. So it has tried to reduce injections into the market, to discipline the banks--a strategy which, since the system is deceased, has not worked so well.

Last week, the ECB shot in 27 billion euros in overnight money, but it failed in collecting back 10 billion euros in even earlier loan-outs to those banks, each of whom pleaded to their bookies like desperate gamblers that they still needed the money. This indicates that the ECB credit injections last week really totaled 37 billion euros.

Should we expect a half-a-trillion euro bailout next week?