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1,765 Posts
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They are calling it shock-and-awe.....


BRUSSELS - European leaders, pressured by sliding markets and doubts over their ability to act in unison, agreed on Sunday to provide a huge rescue package of nearly one trillion dollars in a sweeping effort to regain lost credibility with investors.

After more than 10 hours of talks, finance ministers from the European Union agreed on a deal that would provide $560 billion in new loans and $76 billion under an existing lending program. Elena Salgado, the Spanish finance minister, who announced the deal, also said the International Monetary Fund was prepared to give up to $321 billion separately.

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4 Fried Chickens & A Coke
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2,679 Posts
Here comes more inflation
Federal Reserve opens credit line to Europe

WASHINGTON – The Federal Reserve on Sunday opened a program to ship U.S. dollars to Europe in a move to head off a broader financial crisis on the continent.
Other central banks, including the Bank of Canada, the Bank of England, the European Central Bank and the Swiss National Bank, are also involved in the effort.

The action reopens a program put in place during the 2008 global financial crisis. Under the program, dollars are shipped overseas through the foreign central banks. In turn, these central banks can lend the dollars out to banks in their home countries that are in need of dollar funding to prevent the European crisis from spreading further.

The Fed said action is being taken "in response to the reemergence of strains in U.S. dollar short-term funding markets in Europe."
The debt crisis first erupted in Greece and there are fears that it could spread to Spain, Portugal and other European countries. The crisis has pushed up demand for the U.S. dollar and has weakened the value of the euro, the currency used by 16 European countries.

The Fed said the action was being taken to "prevent the spread of strains to other markets and financial centers."
The Bank of Japan will be considering similar action soon, the Fed said.
The so-called "swap" line with the Bank of Canada provides up to $30 billion. Figures weren't provided for the other central banks. The arrangements were authorized through January 2011.

The Fed had wound down these crisis-era programs with other central banks in February, along with other emergency programs to get lending flowing more freely again and return stability to financial markets.
 

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WINNING...humbly
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3,704 Posts
Come on, the Europeans are all talk and no action. Besides, it's all up to the Germans now and the Germans have spoken in the Yesterday's elections. At least it's a gridlock for years to come, just like in the UK, just like what we will have in November, I hope.
 

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The Power of III
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1,365 Posts
As usual, Market Ticker has his opinion on this credit line:

http://market-ticker.denninger.net/archives/2297-Bernanke-Liar-Again.html

Excerpt:

There's been no "strain" in dollar funding markets.

There has been an extreme level of strain in Euro funding markets.

But see, the Europeans just announced they're going to use an SPV - that is, a secret off-balance sheet funding vehicle with over €400 billion in it.

Who's going to provide the €400 billion? The Fed? (Yes, I know what the Euro folks said. Now how about some transparency? You see, I trust them as much as I trust OUR political and banksters - that is, not at all.)

With what authority does Bernanke effectively appropriate?

Was there an appropriation bill that I seem to have missed by Congress? Or has Bernanke, once again, decided on a unitary basis to entirely ignore the US Constitution?

And furthermore, if he has, will Congress stand for it?

We're going to bail out European banks now, right? US banks weren't enough. Oh wait - we did European banks in 2008 too, didn't we?

Uh, exactly how many taxpayer dollars from US Citizens is The Fed going to give to European banks this time?
 

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Like throwing money into the Titanic while its sinking.What a waste of taxpayer money.It wont matter,as there is nothing we can do to change the feds minds.Now,when they come,hat in hand for another $600B for Italy,then what,do over again.I thought we had adults running the gov,I revised this to 3rd graders when they through their tantrums and lied/swindled a healthcare bill out of congress,but this is not even worthy of kindergarten children.
 

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Premium Member
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9,224 Posts
The EU is doomed.

UK, Netherlands, Germany, France should get out now before this financial crisis sinks their usually robust economies and great technical innovation.
 

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AAAH GET TO ZE CHOPPA!
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1,554 Posts
Reading threads like these make me stare long and hard at those silver bullion sites...
 

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Sam Adams was right....
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9,381 Posts
Merkel essentially lost majority voting power yesterday... who wants to be that the next bailout will be opposed by Germany...
 
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