UK run on Northern Rock Savings Accounts Continues.--

Although a couple of weeks ago the limited run on Nationwide Banks in the US was quickly stemmed, the run on Northern Rock in the UK continues for at least the third straight business day on Monday (via the Guardian):

Thousands of anxious savers besieged branches of Northern Rock this morning [Monday] as the run on the crisis-hit mortgage bank gathered pace.

Its shares plummeted by 34% to 290p within the opening minutes of trading on the stock market today. This follows Friday's 30% share price collapse at the group, Britain's fifth-largest mortgage lender, which has lost three-quarters of its value over the past 12 months.

There were heavy losses among other banks, with Alliance & Leicester down more than 10% and Bradford & Bingley down around 9%.

As much as £2bn is believed to have been withdrawn from Northern Rock accounts on Friday and Saturday, although many online customers were unable to access their funds. The current share price gives the bank a market capitalisation of £1.3bn.

Queues started forming in the early hours this morning, with some customers arriving as early as 3am.

In Leeds, around 100 people were queuing outside the Northern Rock on Briggate. Some had even brought chairs and flasks to make their wait more comfortable. . . .

Caroline Clarkson, 39, said she was frustrated by the bank's response to the crisis. She said: "When you phone them, you can't get through and when you go to the website, it just crashes.

"When you read all the reports over the weekend and you think about your money, I decided it just was not worth the risk. Why risk it when I can take it out today and put it in another account?"

At a branch in Liverpool, one woman, who left clutching a handbag packed with around £3,000 with the strap double-wrapped around her shoulders, said: "It is not much but it's all I have in the world.

"But then, when I think of the staff inside, not knowing how this will turn out and their whole livelihoods are at stake, I feel rotten."

Usually the day before a US Federal Reserve rate cut (expected Tuesday) is an up day in the US stock market, as is the day of a rate cut, but today the US stock market is struggling against European pessimism. Further, the first of the major US brokers (Lehman) reports earnings on Tuesday, which could be either disastrous or surprisingly solid. If you know which way the market will move today and tomorrow, you are smarter than the rest of us.