Fed funds rate soars

Discussion in 'Economy' started by gonegolfin, Sep 15, 2008.

  1. gonegolfin
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    gonegolfin Member

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    The Fed funds rate soared this morning forcing the Fed to intervene and provide the largest liquidity injection since 9/11/01. This is considerably more than the injection that took place at the "beginning" of the credit crisis last August when banks refused to lend to each other and the Fed had to jump in to provide liquidity. The most recent injection came in two chunks. After the $20 billion injection this morning at 9:40am EST failed to contain the fed funds rate (reportedly soared to 6%, whereas 2% is the target), the Fed responded with an additional $50 billion at 11:50am EST. What did the Fed purchase for $70 billion in newly created dollars (assuming there were no sterilization operations - we will know shortly)? Nearly $49 billion in mortgage-backed securities and about $21 billion in agency debt (Fannie, Freddie, etc.). None of the injections took treasuries as collateral.

    Temporary Open Market Operations - Federal Reserve Bank of New York

    Brian
     
  2. editec
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    editec Mr. Forgot-it-All

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    Has been an interesting day on the market, eh?

    Lehman files, they're singing AIG's swan song, WaMu looks shakey.

    The NY metro region is going to go into a recession due to the number of former finanical workers losing their jobs.

    Most of these people made serious incomes, too.
     
  3. Paulie
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    Paulie Platinum Member

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    Let's all just forget about this and tune in to "Don't forget the lyrics!" tonight. I mean, it's much more interesting than pondering the possible collapse of our economy.

    And let's keep voting for the enablers. You know, the McCain's and the Obama's of the world? The one's who the media tell us are the ONES, but as history has proven, ultimately end up being tools for the further ruining of the country?

    But what do I know, I'm a kook.
     
  4. dilloduck
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    dilloduck Diamond Member

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    any suggestions ? Maybe someone will finally believe Americans are owned.
     
  5. Paulie
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    Paulie Platinum Member

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    I think our last shot as a country would be to vote none of the above, or at least someone besides the main 2. Obviously that's not going to happen, and Americans are going to pay the price.

    I've situated myself as best as I can to weather the storm, and as far as I'm concerned, anyone who refused to listen deserves every single bit of their potential demise.
     
  6. dilloduck
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    dilloduck Diamond Member

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    Financial Darwinism here we come !
     
  7. Toro
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    Toro Diamond Member

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    Yeah, I saw this today. When I checked my Bloomberg, the bid/ask spread was 2-3.
     
  8. Care4all
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    Care4all Warrior Princess Supporting Member

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    WHEW! down over 500 points! jimminee christmas! and that was with the feds handing nearly 100 billion of our tax dollars out today....

    fudge, this might actually become a depression, and skip the recession....man oh man we are in trouble...

    see how mccain and palin are now using the dems AMMO and saying we need more regulation....AFTER THE REPUBS were the ones that pushed the deregulating that caused this mess? sheesh...what a bunch of deceivers....

    wonder how the conservatives will take to this bait and switch tactic....will they support more regulation vs the deregulation they continually push for and the mccain camp use to support?
     
    Last edited: Sep 15, 2008
  9. Paulie
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    Paulie Platinum Member

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    That wasn't tax dollars, Care. They don't have any of those available these days. That was good old fashioned money supply expansion.
     
  10. dilloduck
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    dilloduck Diamond Member

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    Hmmmm --America might get a good lesson on how our nations economy functions and who is running the show.
     

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