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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Enigma who wrote (2234)	11/11/1999 7:56:00 PM
From: Henry Volquardsen	Read Replies (2) \| Respond to of 3536

the precedent is already in place. in the '87 market crash when the market looked set to collapse the Fed made it clear to the banks they would provide all needed liquidity. fwiw I don't believe that is a case of 'casting aside all notions of management responsibility'. The Fed has made it clear that it will allow the market to punish individual firms for their mistakes. Continental Illinois in the mid 80s is a good example of this. However a market crash or panic is an external event to most firms and threatens to damage the system regardless of fault. In these circumstances the Fed and all central banks have made it clear they will do what is needed to stabilize the markets and leave punishing those responsible till after the crisis has passed.