September 30, 2008

So if The Fed Just Injected 620 Billion

Why do we still need to spend the other 700 Billion?

Via AFP: The US central bank said it was increasing its swap lines with other central banks by a total of 330 billion dollars to bring the amount available to 620 billion dollars.

The move came as part of a coordinated effort by global finance authorities to make credits available in dollars and ease strains in markets amid a freeze in lending among commercial banks.

The Fed said in a statement the efforts were designed "to support financial stability and to maintain a stable flow of credit to the economy during this period of significant strain in global markets."

"We will continue to adapt these liquidity facilities as necessary and will keep them in place as long as circumstances require," the statement said.

The Fed said it was boosting its own auction facility for US banks to 75 billion dollars per auction from 25 billion, beginning October 6. It also said two credit auctions worth a total of 150 billion dollars would be offered in November to help meet liquidity needs through the end of the year.

Heh, its being called a "Shadow Bailout".

I noted this story was prominent just before the markets opened this morning. Now its evaporating in favor of more bailout calls from Mr. Bush and Congress.

Hmmmm?

By Howie at 09:18 AM | Comments |