The Fed Goes Balls Out... Again

Wednesday, November 30, 2011 , , 4 Comments

I received this love letter to cheap money from the Board moments ago:

The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank are today announcing coordinated actions to enhance their capacity to provide liquidity support to the global financial system. The purpose of these actions is to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity.

These central banks have agreed to lower the pricing on the existing temporary U.S. dollar liquidity swap arrangements by 50 basis points so that the new rate will be the U.S. dollar overnight index swap (OIS) rate plus 50 basis points. This pricing will be applied to all operations conducted from December 5, 2011. The authorization of these swap arrangements has been extended to February 1, 2013. In addition, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank will continue to offer three-month tenders until further notice.

As a contingency measure, these central banks have also agreed to establish temporary bilateral liquidity swap arrangements so that liquidity can be provided in each jurisdiction in any of their currencies should market conditions so warrant. At present, there is no need to offer liquidity in non-domestic currencies other than the U.S. dollar, but the central banks judge it prudent to make the necessary arrangements so that liquidity support operations could be put into place quickly should the need arise. These swap lines are authorized through February 1, 2013.

Does anyone else find it funny that they still feel market conditions warrant all the dollars the world could possibly need?

Remember, it was only yesterday Fed #2 and known easy money whore Janet Yellen insisted the Fed still had wiggle room and tools remaining to ease.

Someone get a towel, the patient is hemorrhaging!

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


I'm still alive. That Zimbabwe Ben is "doing what comes naturally" is no surprise. Got gold? Get more. Got: dollars, euros, pounds, etc.? Fool! Sell!


Anonymous said...

wheres is custer if you needed him

Anonymous said...

the usd just stubbornly wouldn't depreciate!

depreciate you fool! rest of the world stop panic buying usd!

Anonymous said...

does Ben's stomach ulcer go into turbo drive when Euroland goes bust?