Wenger in transfer admission

Arsene Wenger has stressed Arsenal do not have the financial muscle to spend "ridiculous amounts" on January signings.

Wenger's admission backs up chairman Peter Hill-Wood's declaration that the Gunners will not be shelling out vast amounts to reinforce their young squad in the transfer window.

Wenger has been linked with Euro 2008 star Andrei Arshavin and Everton's Spain international Mikel Arteta to cover for the loss of captain Cesc Fabregas and England winger Theo Walcott, but has said fans expecting a surge of expensive buys are living in "dreamland".

"We have a specific budget which is not as big as I have read in the newspapers, some ridiculous amounts of money that are completely crazy. But we will try to use it wisely and well if we can," he said.

"This team is together, getting stronger and stronger - but what we need to focus on is continually developing and not live in dreamland where we are linked with players of £30million or £40million because that is not realistic.

"We have a very, very good squad and we will go for an exceptional talent only - but if it is just to have one player more, we will not do it."

Wenger added: "At the moment, people in football are not conscious of what is facing us economically.

"People still think we are in a bubble, but we will be hit like anybody else in this economical crisis, I am convinced of that.

"You will have a much more cautious market than you expect it to be and one of the isolated powers you could have are Manchester City.

"That will be one of their strengths because they will not have quite as much competition as they would have had in normal circumstances."