THERE is more liquidity in financial markets than ever before, according to the latest figures.

Michael Howell, managing director of Cross Border Capital in London, who was in Guernsey recently to meet some of the investment adviser’s local clients, said it was unprecedented.

‘If you look at the US institutional investments, they have cash equivalent to a quarter of the stock market, which is incredibly high. It has never been that elevated.

‘Compared to other crises, it’s seriously big. In the ’87 crash, cash was equivalent to 4% but now it’s 23%.

‘Everyone is scared and alarmed and the only way to avoid a continual panic is for central banks to continue giving people money until they no longer want it.’

Mr Howell said at the moment everyone wanted cash or cash equivalents and if they had holdings in the stock market they were taking them out and putting them into cash.