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US Bailing Out Foreign Central Banks

http://www.huffingtonpost.com/2009/03/17/us-injecting-billio...

For more than a year, the U.S. Federal Reserve System has been increasingly acting as the world's central bank, injecting hundreds of billions of dollars into foreign government treasuries in an effort to increase liquidity in those countries.

The foreign central banks have used the U.S. currency to bail out financial institutions within their borders. The Fed program links its balance sheet directly to the fates of foreign central banks at a time when they're on the ropes.

The program has so far gone unreported in the mainstream media and is a major expansion of Federal Reserve involvement in the global economy. It represents a stark break from the prior role of the Fed, moving it into territory more traditionally occupied by the International Monetary Fund (IMF).

The program puts both the Fed and the foreign central banks at increased risk. If the bailed-out banks can't repay the loans, the foreign central bank is still on the hook to the Fed. It would have to raise the money by selling debt -- which most Europeans are finding difficult today -- or raise taxes or cut spending, actions that further exacerbate the economic crisis. Or, the foreign central bank could default, leaving the U.S. holding a bag of foreign currency of plummeting value.

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http://www.huffingtonpost.com/2009/03/17/us-injecting-billio...

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http://digg.com/business_finance/HuffPo_US_Bailing_Out_Forei...

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SteveMT's picture

These banks are being paid because if they are not....

they could dump our bonds or cash on the market. The Fed is buying their U.S. held bonds to give them dollars so that that can buy hard assets, similar to the many hedge fund liquidations.
They have us over a barrel and Fed is trying to hide these transactions. They are postponing the inevitable.

it's only a matter of time

when the house made of cards collapses into its own footprint.

enough of politics
I am going to the forest its warm 60F sunny.

peace patriot*)

"(Better) to be confused in the search for truth than fully confident and sound asleep in a dream of lies." ~ Michael Nystrom
http://www.votenader.org/blog/2008/09/10/statement-to-ron-pa...

LL on Twitter: http://twitter.com/LibertyPoet
sometimes LL can suck & sometimes LL rocks!
http://www.dailypaul.com/203008/south-carolina-battle-of-cow...
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15

bump

bump

Thanks for bumps

just found another gem shall post shortly.

peace patriots*)

"(Better) to be confused in the search for truth than fully confident and sound asleep in a dream of lies." ~ Michael Nystrom
http://www.votenader.org/blog/2008/09/10/statement-to-ron-pa...

LL on Twitter: http://twitter.com/LibertyPoet
sometimes LL can suck & sometimes LL rocks!
http://www.dailypaul.com/203008/south-carolina-battle-of-cow...
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15

Unconstitutional!

To compare only:

How would you like to rent an apartment from a landlord that gave away all your furniture because he had borrowed from somebody and couldn't pay back the loan.

illegal, sure!

But banks, without congressional knowledge give taxpayer money that was stolen from taxpayers, to their buddies.

End the Fed!!!

http://endthefedusa.ning.com/

beesting

unscritinized unregulated marshall plan

this is just a free pass on a new type of marshall plan (which previously injected 13 billion to our allies.)

see how far we've come?

where this can happen at a drop of a hat because so much other stuff is going on that it just adds more noise to the chaos.

That is why they want secrecy

Congress should step in and investigate this.

here is an alarming part~
"I'm concerned about Europe," Paul Krugman wrote in Monday's New York Times. "Actually, I'm concerned about the whole world -- there are no safe havens from the global economic storm. But the situation in Europe worries me even more than the situation in America."

Let me tell you Italy Spain they are bankrupt I lived there I know what's going on....

peace patriot*)

"(Better) to be confused in the search for truth than fully confident and sound asleep in a dream of lies." ~ Michael Nystrom
http://www.votenader.org/blog/2008/09/10/statement-to-ron-pa...

LL on Twitter: http://twitter.com/LibertyPoet
sometimes LL can suck & sometimes LL rocks!
http://www.dailypaul.com/203008/south-carolina-battle-of-cow...
Love won! Deliverance from Tyranny is on the way! Col. 2:13-15