itsmeeeeeee

Fed extends emergency loan program for Wall Street

Fed extends emergency loan program for Wall Street - Yahoo! News

By JEANNINE AVERSA, AP Economics Writer 12 minutes ago

WASHINGTON - The Federal Reserve said Wednesday it is extending its emergency borrowing program to Wall Street firms and is taking other steps to ease a severe credit crunch that has hobbled the national economy.


The Fed said the program, where investment houses can tap the central bank for a quick source of cash, will now be available through Jan 30. Originally the program, started on March 17, was supposed to last until mid-September.

Another program, where investment firms can temporarily swap more risky investments for super-safe Treasury securities also will continue through Jan. 30, the Fed said. And, it also will let commercial banks, in a separate program, bid on cash loans that last longer — for 84 days, besides the 28-day loans now available.

The Fed said it was taking these steps "in light of continued fragile circumstances in financial markets." The Fed said that the emergency borrowing program for investment houses and the program that lets investment firms temporarily borrow Treasury securities would be withdrawn should the Fed determine that conditions in financial markets are "no longer unusual and exigent."

The smooth flow of credit is the economy's oxygen. It permits people to finance big-ticket purchases, such as homes and cars, and help businesses expand operations and hire workers. Fallout from a trio of crises — housing, credit and financial — have badly bruised the economy. Growth has slowed and companies have cut hundreds of thousands of jobs.

Investment houses were given similar, emergency loan privileges as commercial banks after a run on Bear Stearns pushed the nation's fifth-largest investment bank to the brink of bankruptcy. The situation raised fears that other Wall Street firms might be in jeopardy.

In the swap program, which began on March 27, investment firms bidding on the Treasury securities can put up as collateral more risky investments. These include certain mortgage-backed securities and bonds secured by federally guaranteed student loans.

The program is intended to make investment companies more inclined to lend to each other. A second goal is providing relief to the distressed market for mortgage-linked securities and for student loans.

The Fed also said it will let Wall Street firms place bids on an option to borrow the Treasury securities. Up to $50 billion would be made available for this. The Fed didn't say when the first auction of this type would be conducted. The notion here is to give firms — unsure whether they might need the Treasury securities — an insurance policy of sorts.

Starting on Aug. 11, the Fed will give banks the option of bidding on 84-day cash loans from the Fed, besides the 28-day loans now available. Specifically, the Fed will conduct biweekly auctions. They will alternate between making available $75 billion in 28-day loans and $25 billion in 84-day loans. The steps expand a program started in December aimed at helping banks overcome their credit problems so that they can keep lending to customers.

The European Central Bank and the Swiss National Bank have informed the Fed that they also will make available to their banks similar 84-day cash loans. To help on this front, the Fed also boosted its credit line with the ECB to $55 billion from $50 billion.

On the other side of the Atlantic, the ECB and the Swiss National Bank announced Wednesday they will make billions of U.S. dollars available to banks still starving for the currency.

The ECB — the central bank for the 15 countries that use the euro — said it will increase the amount of dollars offered to $50 billion in the latest series of operations. The bank will make 84-day loans available starting on Aug. 8 and said operations will continue as long as "needed in view of the prevailing market conditions." Similarly, the Swiss National Bank said it would start making 84-day loans available on Aug. 12.

__________________

cheapseats

Read that, so they can keep makin' money.

__________________

cheapseats

The reason they are IN trouble is because of imprudently risky investments.

Sooo...they can put the shitty investments up as collateral to be bailed out essentially by the People they screwed.

What say the slew of Politicos who were just running for president? What say Senators McCain and Obama?

__________________

itsmeeeeeee

NO!!! YOU'RE THE ONE WHO DOESN'T "GET IT"!!!


CAN YOU SAY CORPORATE WELFARE?
i've HAD it with propping these bastards up.


the free market DOESN'T WORK if failures and crooks and greedy bastards are kept going with corporate welfare.
these businesses WOULD fail and be gone, AND be replaced with better run ones, if their ineptitude weren't constantly being rewarded.

let the free market work! NO MORE CORPORATE WELFARE!!!

__________________

cheapseats

You either know not from whence you speak, or you are a knee-jerk hysteric.


Can you distinguish between different bodies of work?


Talk is cheap.

What are you demanding of Obama, by way of Change?

Are his Fans demanding that he hold the line?

Quote:

let the free market work!

Be careful what you wish for.

An utterly free market, particularly given an unlimited supply of worldwide labor, does not accommodate pesky, persistent social needs that may be said to fall under the umbrella of Health & Welfare. If there's not a line for it on a balance sheet, it's not part of the bottom line. Accommodation of subjective shit like working conditions and morale only erode the bottom line.



Agreed.

No perks for gettin' married or havin' kids, either...other than the joy and fulfillment than a person obviously anticipates by assuming the commitments.

__________________

cheapseats

Ads are running on the radio with a quick, excited car salesman kinda voice, encouraging savvy investors to add real estate to their investment portfolios.

I quote, "THE FORECLOSURE MARKET HAS NEVER BEEN HOTTER."

If I were a Law Enforcement type, I would be cross-referencing the oh-so-hot foreclosure market with the bitterly cold foreclosure crisis to see whether there are any of the same players in both.

I'd be havin' a look at real estate agents and appraisers as well as lenders.

And if I found some Assholes playin' both sides of the coin, I'd be lookin' to throw their asses in federal penitentiaries.

the almighty dollar copyright Implausible endeAVORS TM llc

__________________

itsmeeeeeee

oh, please. you crack me up. talk about not knowing your head from your ass.


bodies of work?
your reply doesn't even make sense.

maybe you should keep your mouth shut if you can't avoid talking like a retard.
i just love it when idiots attempt to sound intellectual!
the only people who fall for their shit are other tards!

we don't need corporate welfare - we need STRICT regulation and accountability.
by your logic (or complete lack of logic, i should say) tax payers should support businesses who completely fuck up.
that's a recipe for disaster.

fuck em.
i don't care who they are.
if they can't run a business, they shouldn't BE IN business.
no special favors for big business and absolutely NO welfare.
get rid of these pariahs, and better run, responsible business WILL take their place.
THAT'S a free market.

this is nothing more than fascism.

__________________

DanS.

It is not corporate welfare, it is not taxpayer money and it does have to be paid back.

itsmeeeeeee

you call it whatever you want...

it's still bailing out BIG failing businesses when nothing is being done to help small businesses who employ the vast majority of americans. these big corporations give their CEO's massive salaries to what.... mismanage the business? fuck that. let em tank.


this isn't how a free market is supposed to work.
perfect example is GM. they squandered opportunities to develop cars that get better fuel mileage - when they were already producing cars for europe that got much better mileage and now we bail them out - they actually crushed their fleet of EV's? screw them and the horse they rode in on.

__________________

DanS.

Well the problem with faulting GM is that nobody here wanted to buy the smaller fuel efficient cars. They made what we wanted here, and what Europeans wanted there...

there have been attempts to bring the European cars here before and usually the effort tanks...Americans just won't buy them. That's why most think that Ford's plan to bring some of it's European cars here now will fail.