Bank Crisis: US Should Follow UK's Lead, Ross Says
The U.S. government has to come up with more broad-based solutions to the financial crisis, following the example of the UK which pledged to part-nationalize financial institutions to defend its banking sector, billionaire investor Wilbur Ross told CNBC on Friday.
"I think the government needs to drop another shoe, one big bold set of things and get it out of the way," Ross said. "Bold, conclusive action is what is needed from the part of the government."
"I would like them to invite the private sector to participate," he said.
The U.S. government is weighing guaranteeing billions of dollars in bank debt and temporarily insuring all U.S. bank deposits, in a bid to unfreeze bank lending and staunch massive losses in equity markets, the Wall Street Journal reported.
On Wednesday, Britain said it would inject 50 billion pounds ($87 billion) of emergency capital into banks left reeling by the global financial crisis in exchange for preferred shares and extend 250 billion pounds in guarantees to help them refinance senior debt.
The world economy cannot afford another big bank failure, some analysts have been saying.
"In retrospect, letting Lehman go was an expensive decision. I think what happened they didn't realize the true connections," Ross said.