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View Full Version : Bernanke (Sort of) Follows Schiff's Advice, Trades Dollars for Other Currencies




Knightskye
04-06-2009, 10:04 PM
http://apnews.myway.com/article/20090406/D97D2DCG2.html


By CHRISTOPHER S. RUGABER

WASHINGTON (AP) - The Federal Reserve said Monday it has expanded credit lines with the central banks of Japan, Switzerland, the United Kingdom and European Union that will provide foreign currency to U.S. banks - if needed.

Under currency swap arrangements, which were common last fall when the credit crisis intensified, the Fed provides dollars in exchange for reserves of the other nations' currencies.

"Should the need arise, euro, yen, sterling and Swiss francs would be provided to the Federal Reserve via these additional swap agreements with the relevant central banks," according to the Fed release. "Central banks continue to work together and are taking steps as appropriate to foster stability in global financial markets."

The Fed said the expanded credit lines, authorized through Oct. 30, are worth the equivalent of up to $45 billion with the Bank of England, $108 billion with the European Central Bank, $99 billion with the Bank of Japan and $35 billion with the Swiss National Bank

Separately, the Fed said it will auction off $150 billion in short-term loans to nonbanks and other financial institutions under a program that began last year. The auctions provide loans to those institutions on similar terms that the central bank provides to banks, and are intended to stabilize the U.S. financial system.

That's $437 billion. :eek:

BeFranklin
04-06-2009, 10:05 PM
If you're going to print unlimited amounts of money, might as well trade it for anything you can get :)

RSLudlum
04-06-2009, 10:32 PM
the Fed said it will auction off $150 billion in short-term loans to nonbanks and other financial institutions


What is the definition of "financial institution"? When they state this is it within the same scope of the definition found in the Patriot Act, or did that definition only apply to those powers 'granted' within the Patriot Act? I know the Patriot Act had to deal with changing alot of the code but did it include a sweeping across the board change in the definition of 'financial institution"? But does it really matter when the Fed seems to do what ever it wants? :mad:

partial list of 'financial institutions' from the Patriot Act:


source:
http://www.imf.org/external/np/leg/sem/2002/cdmfl/eng/tompki.pdf
page 6


Title III of the Act amends the Bank Secrecy Act (“BSA”) and, thus,
incorporates the definition of “financial institutions” contained in the BSA. It also adds certain
additional institutions to the pre-existing definition. Specifically, the pre-Title III definition of
“financial institution” included the following: FDIC-insured depository institutions, trust
companies, SEC-registered broker-dealers, insurance companies, private bankers, agencies and branches, investment banks, investment companies, currency exchanges, licensed money
transmitters, credit card systems operators, dealers in precious metals and jewels, pawnbrokers, finance lenders, travel agencies, telegraph companies, real estate agents, the United States Postal Service, certain casinos, and automobile, airplane and boat dealers. Title III of the Act added the following institutions to the prior definition of “financial institution”: credit unions, futures commission merchants, commodity and trading advisors, and commodity pool operators.