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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (757)	8/12/2007 2:56:24 PM
From: RockyBalboa	Respond to of 71475

You are correct. We are there; the fed couldn't handle the liquidity needs alone therefore they asked the ecb and the boj to help. The joint forces at the printing press took away the pressure from the USD by purchasing billions right when the fed also pumped, otherwise the USD would have crashed.

To: Real Man who wrote (757)	8/12/2007 7:45:17 PM
From: RockyBalboa	Respond to of 71475

An Economist article has similar thoughts as to ECBs role: ... Towards the end of last week the cost of interbank lending suddenly shot up. Rates for overnight borrowing spiked to nearly 6% in America, well above the Federal Reserve's target rate of 5.25%. In the euro area rates rose to 4.7%, compared with the central bank's benchmark rate of 4%. The European Central Bank (ECB) was first to respond to the squeeze. It provided €95 billion ($131 billion) of additional funds to the money market on August 9th, even more than it had supplied on September 12th, 2001 in the aftermath of terrorist attacks. It followed this up with a further shot of €61 billion the following day. The corresponding intervention by America's central bank—$24 billion on August 9th and another $38 billion the day after—looked less drastic. But banks' higher reserve requirements in Europe meant that the ECB had to inject proportionately more cash to achieve the same effect. Some analysts speculated that some of the funds borrowed by commercial banks in Europe were quickly swapped into dollars to be lent in the American money markets. If so, the ECB became the de facto global supplier of liquidity, simply because the European markets opened first. ...