The Fed’s decision to reduce the cost of the dollar loans means that it is now providing money at lower cost to European banks than to American banks.
So what is to stop U.S. banks from getting European banks to get their dollars for them when those banks get them cheaper?
Cheers, ken
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From: Ferenc Molnar <ferenc_molnar at hotmail.com> To: lbo-talk at lbo-talk.org Sent: Wednesday, November 30, 2011 1:03:53 PM Subject: [lbo-talk] Central Banks to the rescue
Is this another bailout by the Fed where euros are bought indirectly through an intermediary bank? Will the amount of money lent by the Fed be kept from public scrutiny until the next FOIA request comes through? And what about the other "Central Banks"; will the amount of their loans also be kept from public scrutiny?
"WASHINGTON — The Federal Reserve moved Wednesday with other major central banks to buttress the financial system by increasing the availability of dollars outside the United States, reflecting growing concern about the fallout of the European debt crisis... The banks announced that they would reduce by roughly half the cost of an existing program under which banks in foreign countries can borrow dollars from their own central banks, which in turn get those dollars from the Fed. The banks also said that loans will be available until February 2013, extending a previous endpoint of August 2012."
http://www.nytimes.com/2011/12/01/business/central-banks-move-together-to-ease-debt-crisis.html?hp ___________________________________ http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk