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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (42260)	4/15/2011 9:58:40 AM
From: Spekulatius	2 Recommendations Read Replies (1) \| Respond to of 78729

I believe the authors of the Rolling stone article make it appear like the loans are handouts. Very likely we are talking about overnight or very short term loans that were backed by securities. Basically, the FED was replacing the interbank lending that was freezing up. these loans (to foreign institutions) are most likely paid back for a long time already. Why did they extend this to foreign institution? Because those institutions do a huge amount of business in US$ and in US financial markets and there actually was a "shortage" of US$ for a while, since everybody was gravitating towards the US$ and the Yen. Well the latter is not a problem any more, obviously.