The FED has pumped SO MANY BILLIONS out there, I have truly LOST COUNT!!! We have at least $300b to Fannie/Freddie, $85b to AIG, $30 to Bear/Stern, HOW MANY BILLIONS from BERNANKE over the summer? $500b? Now the Boston Fed kicks out $70b. Toss in $180b from "the Fed and other central banks" the other day, and about $250b out to foreign banks and the #s just slid off my calculator.
Where they getting all this $$$$? PRINTING IT?
Also see: Mutual Funds Say Bailout Bill Not Needed
FED to pump over 600 BILLION to banks anyway
Americans Pulling Money Out of Markets
So HOW MANY TRILLIONS does that add up to? I've lost count.
And they want $700 BILLION MORE?
"Boston Fed loans $152.1b for funds; Money markets squeezed hard" by Steven Syre, Globe Staff | October 3, 2008
The Federal Reserve Bank of Boston has loaned out $152.1 billion over 10 days in an effort to ensure that money market mutual funds have enough cash to repay customers requesting their money back.
The Boston Fed is administering one of the key emergency steps the government has taken to stem the hemorrhaging in the nation's financial sector. The program loans to banks so they can buy short-term investments held by money market mutual funds that otherwise would be difficult or impossible to sell. This allows the funds to quickly raise cash in case they experience more runs on withdrawals such as those which forced Putnam Investments to abruptly close a money market mutual fund last month.
The Boston Fed's loan balance as of Wednesday increased by $80 billion from the previous week. The bank had loaned $72 billion in the first three days of the program last week.
Money market funds have been squeezed hard by worried customers demanding their money back, while the market for the short-term debt securities they own has slowed drastically. Without the ability to sell assets at face value, money funds might not be able to return cash to shareholders or maintain their steady value of $1 per share.
Last month Reserve Management became the first money market mutual fund manager in more than a decade to "break the buck," when the value of one of its major funds fell below $1. The company yesterday said it was closing another fund, the $10 billion US Government Fund. The company had suspended withdrawals because of the large amount of requests from investors for their money back.
Separately, Reserve Management yesterday said it has repaid Nissan Motor Co. for funds the Japanese company had deposited in a Reserve trust. Nissan this week sued Reserve, as well as a unit of State Street Corp. of Boston, the custodian of the trust, seeking repayment of $39.2 million.
The Boston Fed program loans to commercial banks, which in turn can buy securities held by money market mutual funds: asset-backed commercial paper - debt backed by home equity lines, car loans, and other types of credit. The Fed program only applies to the sale of the highest-rated asset-backed commercial paper, but the loans are offered on a "nonrecourse" basis, so banks are not on the hook if the securities lose any value.
Besides easing pressure on money markets, the Fed hopes its loan plan will help markets that trade high-grade, short-term securities to function normally again. Money funds could have driven down prices and created widespread losses if they became desperation sellers in an illiquid market. Those markets are important because many companies raise money there to fund routine business operations. Companies and financial institutions depend on them as a reliable and inexpensive source of money.
Remember, readers, U.S. Banks Driving Credit Crunch ON PURPOSE!
The Fed loan program is one of several government efforts to ease financial pressure on money market funds. The US Treasury has offered to temporarily insure money fund assets, a plan accepted by funds, including some at Putnam Investments and Evergreen Investments.
--more--"Then why do they need a BAILOUT BILL if they ALREADY HAVE TOOLS?
