The Fed has reopened its forex swap lines with the ECB, effectively giving unlimited quantities of dollars to European banks and institutions (and governments)!
The Fed stopped buying Mortgaged Backed Securities here in the U.S. which would have helped American homeowners, but they eagerly rush to bail out the Europeans.
This is beyond outrageous.
Please call, email or write to your Congressional representative immediately and say that the Fed's actions must be stopped!
Mike,
ReplyDeleteOutrageous. The credit line to the "ECB" is UNLIMITED / full allotment again. Also: $30B line for CANADA!? With $80 oil?
This means that all acceptable collateral at the "ECB" is acceptable for US dollars via this Fed facility.
All the Greek govt debt (that not too long ago was considered "toxic" by ratings agencies, but recently upgraded by ECB fiat) is now effectively acceptable at the Fed at a 1% annual rate. You can just see here how the Fed wants to provide massive amounts of USD to virtually ANYBODY with a pulse, whether via the IMF or here via these swap facilities, I think your quote from last time was "the Fed is sitting on the dollar" and it looks like they are trying again.
Ill keep an eye on the ECB USD operations this week and see if any USD are accessed via this Fed facilty, I think they do the operations on Tuesdays/Wednesdays.
Perhaps Greek voters can kill all of this if they vote against austerity in the upcoming elections like Iceland voted against Eurozone bank bailouts when they had the chance...Bernanke may yet be proven to be the chump that I think he is...he is getting rolled. What about the purchasing power for US consumers that a stronger USD could provide?, etc..
Matt,
ReplyDeleteWE the American people are the biggest chumps for letting this happen. There should be riots in the streets here to protest these outrageous actions. It's a disgrace. I think I'm becoming a Ron Paul supporter. Abolish the Fed!!!