Chelsea's bid to sign Real Madrid's Cameroon defender Geremi and Brazilian midfielder Flavio Conceicao has fallen through because of the cost involved in the transfers.

"It was all fixed with Real, but the club (Chelsea) rang me and said that we would have to pull out of the deal for these two lads because we could not afford it," Chelsea coach Claudio Ranieri told Spanish sports daily Marca.

"I am very sorry about it, but we are going through a very difficult period in football and Chelsea can't afford to spend a penny at the moment."

On Monday Real Madrid's sporting director Jorge Valdano also predicted a major slowdown in the transfer market.

"The market is at a standstill," he said. "No club is daring to make a move at the moment.

"The economic recession has put an end to the party and teams now understand that they cannot afford to spend their money frivolously.

"If it was difficult enough to sell players last year, it is going to be even harder this time round."