Fed injects $59 billion into market over 48hrs
That's over a billion dollars an hour! (see updated figure in comment below) --qrs
MoneyNews | Friday, Aug. 10, 2007The U.S. Federal Reserve Friday provided the largest amount of liquidity for a single market operation in four years, adding ample funds for the second day running as markets fretted over credit conditions.
In a rare statement shortly after the operation, the Fed said it would provide liquidity as needed "to facilitate the orderly functioning of financial markets".
"In current circumstances, depository institutions may experience unusual funding needs because of dislocations in money and credit markets," it said.
The last time the central bank made a similar statement was after the Sept. 11, 2001, terror attacks, when it also said it would do what was necessary to keep markets functioning normally. The Fed had made a similar vow in October 1987 following a precipitous decline in U.S. stock markets.
Major central banks have been adding temporary additional liquidity to the banking system in the past two days as short-term interest rates spiked in response to banks' decreased willingness to lend to each other.
In an operation conducted earlier than usual, the Fed added $19 billion of temporary reserves to the banking system through 3-day repurchase agreements, compared with adding $7.5 billion through 3-day repurchase agreements last Friday.
It was the biggest single operation for a day since August 15, 2003, when there was a $20 billion fund injection.
"Today's action indicates that (Fed policy-makers) are being more pro-active to ensure financial stability," said David Katz, chief investment officer at Matrix Asset Advisors in New York.
The fed funds rate was trading at 6 percent in early morning trade, but fell back to 5.25 percent shortly after the operation, in line with the target set by the central bank. It was last trading at 5.375 percent.
The single $19 billion fund injection followed a total $24 billion injection on Thursday in two separate operations.
The Fed said all of the collateral accepted in the 3-day repo on Friday was mortgage-backed debt. The repurchase was the largest 3-day operation in at least a year.
The Fed added a total of $68.5 billion to its reserves this week, compared with a total of $50.25 billion last week.
The central bank announced the repurchase agreement earlier than it typically would, near 8:10 a.m. (1210 GMT) instead of the typical release at 9:30 a.m. (1330 GMT).
So much for a 'free-market' that adjusted naturally!
IT's all a gambit!
What a joke!
US President George W Bush insisted that the Federal Reserve had done enough to keep credit flowing. “I am told there is enough liquidity to enable those markets to correct. The fundamentals of our economy are strong,” he said.
accepted by the FED in return for this "liquid" is in the form of mortgage-backed securities.
In other words, either the Fed is bailing out Freddia Mac and Fannie Mae, or because the two are no longer capable of functioning as they were designed to (relieve banks from the risk of defaulting mortgagers) the Fed is now temporarily serving that function (using other people's money of course) and charging the American tax-payer interest to boot.
what a scam.
Also, that means that the Fed now owns all those mortgages.
Say hello to your new landlord, America!
---------------------------------------
"Money" has no value - people do.
What all this means is that mortgage bankers carry NO RISK WHATSOEVER except the risk that borrowers might WISE UP and PRE-pay their loan MINUS INTEREST.
---------------------------------------
"Money" has no value - people do.
That's 35 today, plus 24 yesterday - $59 billion in total.
This is sheer insanity.
Nothing but a scam to maintain the illusion that these gamblers and loan sharks do anything useful in society.
---------------------------------------
"Money" has no value - people do.
How does the Fed (or any Central Bank) know on an hour-by-hour basis whether its last liquidity infusion has succeeded in keeping the financial markets sufficiently "well-oiled"? Is this determined entirely by observation of the equities market?
thanks Qrs.
apossumprincess asks:
"How does the Fed (or any Central Bank) know on an hour-by-hour basis whether its last liquidity infusion has succeeded in keeping the financial markets sufficiently "well-oiled"?"
They don't give a damn - that's how!
They're pumping money into the market for specific reasons that remain PRIVATE, as the FED is a PRIVATE organization.
Most probably it has to do with how much they (as opposed to the average investor) have invested in the phoney markets at the moment.
---------------------------------------
"Money" has no value - people do.
How will the U.S. get out of this one, once the ripple effect really takes hold of all America, and not just the the foolish people that engaged in this venture? I can hear the elitists saying, "We need a good war to get us out of this!" Maybe Iran?! The Fed, I mean the jews that run the Fed, are always two steps ahead of the game because they make the rules. They knew this was possible (It probably could of been planned), and anything that is done in response to this crisis is also planned. The Jews know exactly what they are doing. Maybe they will force us to give a few states up to China or allow the steam rolling of Gaza. It sounds like force may be the U.S's only option. If only they can pay for their missles and bullets. This was planned by the bankers. They are two steps ahead of everything that transpires. The big question is, "WHAT DO THEY WANT IN RETURN?!?!?!?"
All fall down.. and then sweep the Fed away and start over - and stay in our houses anyway.
Haha.
According to LaRouche, it's not just US:
This is all bullshit.
Bankers are "afraid to lend money" because they're GREEDY SOBs. Plain and simple.
No matter how much money the Fed pumps into the system it will NEVER be enough to satisfy them.
Bankers intend to pull the proverbial rug out from underneath our economies and they expect us to beg them to bail us out.
---------------------------------------
"Money" has no value - people do.
The funny thing is,
the billions is probably a 'loan' that we American Citizens will be forced to pay the 'interest' on forever.
The government is quick to bail out the mega-billion dollar corporations and banks, but slow as hell to assist anyone else (like Katrina victims).