noworldsystem.com


Federal Reserve Plans To Nationalize All US Banks

Federal Reserve Plans To Nationalize All US Banks

Telegraph
March 31, 2008

The US Federal Reserve is examining the Nordic bank nationalisations of the 1990s as a possible interim solution to the US financial crisis…

The Fed has been criticised for its rescue of Bear Stearns, which critics say has degenerated into a taxpayer gift to rich bankers…

A senior official at one of the Scandinavian central banks told The Daily Telegraph that Fed strategists had stepped up contacts to learn how Norway, Sweden and Finland managed their traumatic crisis from 1991 to 1993, which brought the region’s economy to its knees…

It is understood that Fed vice-chairman Don Kohn remains very concerned by the depth of the US crisis and is eyeing the Nordic approach for contingency options…

Scandinavia’s bank rescue proved successful and is now a model for central bankers, unlike Japan’s drawn-out response, where ailing banks were propped up in a half-public limbo for years…

While the responses varied in each Nordic country, there a was major effort to avoid the sort of “moral hazard” that has bedevilled efforts by the Fed and the Bank of England in trying to stabilise their banking systems…

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged. Two of the country’s top four banks – Christiania Bank and Fokus – were seized by force majeure…

“We were determined not to get caught in the game we’ve seen with Bear Stearns where shareholders make money out of the rescue,” said one Norwegian adviser…

“The law was amended so that we could take 100pc control of any bank where its equity had fallen below zero. Shareholders were left with nothing. It was very controversial,” he said…

Stefan Ingves, governor of Sweden’s Riksbank, said his country passed an act so it could seize banks where the capital adequacy ratio had fallen below 2pc. Efforts were also made to protect against “blackmail” by shareholders…

Mr Ingves said there were parallels with the US crisis, citing the use of off-balance sheet vehicles to speculate on property. All the Nordic banks were nursed back to health and refloated or merged…

The tough policies contrast with the Fed’s bail-out of Bear Stearns, where shareholders forced JP Morgan to increase its Fed-led rescue offer from $2 to $10 a share. Christopher Wood, chief strategist at brokers CLSA, says the Fed’s piecemeal approach has led to “appalling moral hazard”…

“Shareholders have been able to lobby for a higher share price only because the Fed took over the credit risk on $30bn of the investment bank’s dubious paper. The whole affair also amounts to a colossal subsidy for JP Morgan,” he said…

 

Federal Reserve SWAT Teams To Police The Economy?

NY Times
March 3, 2008

WASHINGTON — The Treasury Department will propose on Monday that Congress give the Federal Reserve broad new authority to oversee financial market stability, in effect allowing it to send SWAT teams into any corner of the industry or any institution that might pose a risk to the overall system.

[…]

Under the Treasury proposal, Fed officials would be allowed to examine the practices and even the internal bookkeeping of brokerage firms, hedge funds, commodity-trading exchanges and any other institution that might pose a risk to the overall financial system.

Read Full Article Here

 

Real Estate Price Collapse, Paradise Lost in SW Florida

http://www.youtube.com/watch?v=VgTdxEGauok

 

Recession: The Movie – Now playing everywhere

http://www.youtube.com/watch?v=x4OOCReeLWo

Recent News:
U.S. & UK To Deal With Financial Crisis
http://www.ft.com/cms/s/0/991194..000077b07658.html?nclick_check=1

Fed Bailout Of Bear Streans Looks Like Investment
http://www.businessweek.com/..4/b4078000069548.htm

German watchdog eyes $600 bln global bank losses: report
http://biz.yahoo.com/rb/080329/germany_banks_losses.html?.v=1

Weak dollar not at odds with policy: ex-US official
http://www.reuters.com/article/ousiv/idUSHKG3018120080331

Dollar Falls to Near Record Low Against Euro on Inflation Data
http://www.bloomberg.com/apps/news?pi..4V7YusRk&refer=japan

Market Plunges, Fed Acts
http://norris.blogs.nytimes.com/2008/03/31/market-plunges-fed-acts/

Paulson Claims Stimulus To Create 600K Jobs
http://news.yahoo.com/s/nm/2008.._nNh3mLV3UPKb.HQA

Paulson warns US house prices must plunge; Orders for Durable Goods in U.S. Unexpectedly Fell
http://business.timesonline.co.uk/tol/b.._finance/article3627054.ece

Paulson Backs Regulatory Overhaul, Broader Fed Role
http://www.bloomberg.com/apps/new..sid=a9LEWNdBhrf8&refer=home

Is Cheney betting on Economic Collapse?
http://www.informationclearinghouse.info/article13851.htm

Fed Auctions Another $50 Billion To Banks
http://news.yahoo.com/s/ap/200..vxGaVFf7P_qKL62bAV9mpv24cA

Paulson To Visit China Next Week
One In Six West Virginians On Food Stamps
Bush: Rebate Checks Will Make Economy ‘Stronger Than Ever Before’
Eurozone Struggles With Inflation
USA 2008: The Great Depression
Fed Official: U.S. Slipping Into Recession
Investment Firms Tap Fed For Billions

U.S. Economic Collapse News Archive

 



The Federal Reserve Is Destroying America

The Federal Reserve Is Destroying America

Lee Rogers
Funny Money Report
March 17, 2008

It is incredible to see the rampant devaluation of the U.S. Dollar. The Federal Reserve just hours ago made a rare cut of 25 basis points during the weekend which will cause even more inflation. Gold immediately moved up $20 an ounce and the U.S. Dollar Index plunged under 71 in international trading. If this type of market activity continues the U.S. Dollar will have no value in a few months. While it is probably unlikely that we will see a hyper-inflationary collapse of the U.S. Dollar within the next few months, these policies are entirely unsustainable. If the Federal Reserve does not move to defend the value of the U.S. Dollar we will eventually see a hyper-inflationary collapse and worldwide financial turmoil. This view is also shared by other well respected financial analysts. Peter Schiff recently raised concerns about a hyper-inflationary collapse of the U.S. Dollar, Robert Reich a former Clinton cabinet member believes we are facing a depression and Alan Greenspan the man who caused this whole mess wrote in the Financial Times stating that we are facing the worst financial crisis since World War II. What’s amazing is that the Federal Reserve isn’t even trying to protect the U.S. Dollar because all they care about is saving the power of their private banking cartel. They don’t care about the U.S. Dollar nor do they care about the country itself. They are destroying this country through their actions and there needs to be an investigation into the controllers of this bank.

Read Full Article Here

 

A Time For Caution

321 Gold
March 16, 2008

I wrote a piece 10 days ago suggesting caution on the part of my readers. Gold and silver are at bullish extremes; the dollar is at a bearish extreme. In any normal time, we would expect to see a correction, probably violent. I still believe we will have a correction shortly but we may no longer control anything. While the metals and the dollar are showing extremes of emotion, the shares of mining companies still seem to be very bullish based on my read of the XAU over gold.

My readers are smart enough to realize we are not in normal times. We are in a Domino Depression where we can expect two or three hedge funds to collapse every day, banks to go under on a regular basis. Northern Rock collapsed last fall, I for one, cannot understand how the rest of the banking system has not failed.

It’s starting again; we are in uncharted waters where no one quite understands where we are; we’ve never been here before. Bear Sterns crashed on Friday last. On Monday March 17th, President Bush meets with the infamous Plunge Protection Team. The alternatives are everything from a Bank Holiday to a nuclear attack on Iran to Bush declaring a “National Emergency” and naming himself Fuhrer.

One of the very real alternatives is Weimar style inflation. That’s what the government would like to do; it’s a question of if the rest of the world will go along with it. All it would take for a total and immediate failure would be for China or Russia or Japan or Saudi Arabia to dump the dollar.

It’s a time for caution. We SHOULD have a violent correction in gold and silver and the dollar based on emotion and government intervention but we could see $3,000 gold in a week or the start of a living nightmare brought to you by the Gang of Fools in Washington. No one knows.

I’m tempted to say the government’s ability to deceive is far greater than I ever imagined and the stupidity of Americans equally unimagined. We may well coast into Armageddon at a nice measured rate or we could see a freeze-up next week. The time will come when there is a total freeze-up in the banking system and all the banks will close. I just don’t know if it’s next week or not.

It’s a time to be cautious. We are not entering a recession; it’s a full-blown Domino Depression. It’s not a time to be in CDs or Real Estate or speculating in the stock market. You need to own real things of some real value. Our world is changing at an ever-increasing rate. Own some physical gold and pay attention to what is going on.

 

Leading Economic Writer: Financial Meltdown A “Gigantic Fraud”

Steve Watson
Infowars.net
March 17, 2008

A leading economic journalist has described the current financial crisis as a “gigantic fraud”, the fallout of a deliberate and preconceived profit agenda to enslave the middle classes in a debt bubble.

The economics editor of the London Guardian, Larry Elliott, has hit out at the global financial elite in a refreshing piece that marks a rare shift away from the establishment hackery we are used to from the corporate media.

In an article titled America was conned – who will pay? Elliot writes:

Indeed, it is somewhat surprising that there is not already rioting in the streets, given the gigantic fraud perpetrated by the financial elite at the expense of ordinary Americans.

[…]

Business, of course, needs consumers to carry on spending in order to make money, so a way had to be found to persuade households to do their patriotic duty. The method chosen was simple. Whip up a colossal housing bubble, convince consumers that it makes sense to borrow money against the rising value of their homes to supplement their meagre real wage growth and watch the profits roll in.

As they did – for a while. Now it’s payback time and the mood could get very ugly. Americans, to put it bluntly, have been conned. They have been duped by a bunch of serpent-tongued hucksters who packed up the wagon and made it across the county line before a lynch mob could be formed.

Elliot also states that the debate is now not about whether the US faces a recession, but is about how deep it will be and how long it will last, comparing the downturn to the South Sea Bubble crisis in 1720, and declaring that the “Ponzi securitisation scam has been exposed.”

A Ponzi scheme, named after Charles Ponzi, is one that offers abnormally high short-term returns in order to entice new investors. The high returns that a Ponzi scheme advertises and pays require an ever-increasing flow of money from investors in order to keep the scheme going, meaning it is inevitable that it will eventually collapse.

Read Full Article Here

Stock Guru Granville: We Are In A Crash
http://www.bloomberg.com..p;sid=aMVeMY2hvYUI&refer=home

Not Just Recession, Clinton Appointee Talking ‘Depression’
http://www.businessandmedia.org/articles/2008/20080314131851.aspx

Oil plummets on economy worries
http://news.yahoo.com/s/ap/20080317/ap_on_bi_ge/oil_prices

Bernanke May Run Low on `Ammunition’ for Loans, Rates
http://www.bloomberg.com/apps/news..amp;refer=exclusive

Who Is Responsible for the World Food Shortage?
http://www.larouchepub.com/other/1995/2249_food_intro.html

NZ market hit by US meltdown
http://www.newstalkzb.co.nz/newsdetail1.asp?storyID=134130

House, Senate endorse tax hikes
http://www.rawstory.com/new..enate_endorse_tax_hikes_03132008.html

Dollars Tough To Sell On Amsterdam
http://www.reuters.com/article/ousiv/idUSL1758265520080317

Gulf States Creep Away From Plunging Dollar
http://prisonplanet.com/articles/march2008/031708_creep_away.htm

IMF, OECD hit alarm buttons for crisis-hit global financial system
http://news.yahoo.com/s/afp/200803..Aj6Sk0_nk7A4Wj6bi0U.nq7.ucsA

Goldman Sees $175 Oil & Explosive Commodities
http://www.bloomberg.com/app..newsarchive&sid=aUmQ3MBOkx_0

 



Fed Cuts Interest Rates 75 Basis Points

Fed Cuts Interest Rates 75 Basis Points

AP
January 22, 2008

Fbiiraqisbein_mn

The Federal Reserve, confronted with a global stock sell-off fanned by increased fears of a recession, slashed a key interest rate by three-quarters of a percentage point on Tuesday and indicated further rate cuts were likely.

The surprise reduction in the federal funds rate from 4.25 down to 3.5 percent marked the biggest funds rate cut on records going back to 1990.

Federal Reserve Chairman Ben Bernanke and his colleagues took the action after an emergency video conference on Monday night, a day when global markets had been pounded by rising concerns that weakness in the world’s largest economy was spreading worldwide.

Despite the Fed’s bold move, Wall Street plunged at the opening. The Dow Jones industrial average was down 311.99 points in the first hour of trading.

In a brief statement explaining its move, the Fed said that “appreciable downside risks to growth remain” and officials pledged to “act in a timely manner” to deal with the risks facing the economy. The action was approved on an 8-1 vote.

Analysts said the fact that the Fed did not wait until its meeting next week to cut rates underscored the seriousness of the situation.

“The world’s stock markets are in meltdown so the Fed came in with an inter-meeting move to try to stop the panic,” Christopher Rupkey, senior economist at Bank of Tokyo-Mitsubishi.

The Bush administration, which had announced on Friday that President Bush supported a $150 billion economic stimulus package, said Tuesday that it was not ruling out doing more than the $150 billion proposal if necessary.

Many analysts said if the carnage continues in stock markets, the Fed will move to cut rates again at its Jan. 29-30 meeting.

“This move is not an instant fix,” said Ian Shepherdson, chief U.S. economist at High Frequency Economics. “The economy is still staring recession in the face, but at least the Fed now gets it.”

Read Full Article Here

 

‘Fed may keep cutting interest rates’

Western Mail
January 23, 2008

There could be more interest rate cuts to come as the US Federal Reserve tries to head off recession.

Howard Archer of Global Insight said the prospect of a US recession suggests the Fed may keep cutting rates.

Yesterday’s surprise decision to cut US rates by 0.75% helped rally London’s FTSE-100 index, after £76bn had been wiped off its value on Monday. The index of leading shares closed 161.9 up at 5740.1, a gain of 2.9% after Monday’s 5.5% fall.

The Fed’s cut to 3.50% was its first emergency move since 2001 and the largest single reduction since 1984.

Mr Archer of Global Insight said “The Fed did not directly reference Monday’s global stock-market meltdown in its announcement, merely noting that ‘broader financial market conditions have continued to deteriorate’. It focused upon the weakening outlook for growth.”

Read Full Article Here

 


US rates ‘heading for 2.5% by the spring’

The Scotsman
January 23, 2008

American interest rates are set to tumble as low as 2.5 per cent by early spring as US policymakers battle to restore stability to a faltering economy.

Economists said they expected the Federal Reserve to have shaved another full point off borrowing costs by its scheduled April meeting.

The prediction came after yesterday’s surprise three-quarter-point cut to 3.5 per cent – a move that appeared to have only limited success in restoring investor confidence.

Bonds jumped sharply, with two-year notes falling to their lowest in nearly four years, as investors prepared for still more rate- cutting.

In London, the benchmark FTSE 100 index of Britain’s biggest companies closed 161.9 points or nearly 3 per cent higher at 5,740.1 following a rollercoaster session and the previous day’s 323-point battering.

Nigel Gault, chief US economist at forecasting body Global Insight, said the prospect of “at least a mild US recession” suggested the Fed was “far from done cutting rates”.

He added: “We now expect the Fed to cut another cumulative 100 basis points off interest rates. The next instalment will probably come at the formal meeting on 30 January – another 25 or 50 basis points. We would expect to hit 2.5 per cent by the April meeting.”

Yesterday’s decision to slash interest rates came a week before the US central bank’s regularly scheduled meeting, a sign that it acknowledges that the global financial situation is serious.

David Jones, chief economist at DMJ Advisors, said the Fed could move again between meetings, should conditions deteriorate further, and predicted the Fed would lower interest rates to 3 per cent by the end of March.

Earlier this month, leading investment bank Merrill Lynch said the US economy was already in recession.

Some analysts pointed to a panic move by the Fed, which is headed by chairman Ben Bernanke. Michael Metz, chief investment strategist at Oppenheimer in New York, said: “Unfortunately the Fed] have no power to reverse what in my opinion is the worst post-war recession.”

Read Full Article Here

Recent News:

Dollar finds support from rising stocks, but confidence remains shaky
http://www.forbes.com/markets/feeds/afx/2008/01/23/afx4561857.html

Gold steady $890 amid rebounding equity mkts but sentiment remains fragile
http://www.forbes.com/afxnewslimited/feeds/afx/2008/01/23/afx4561918.html

Let Market Crash Now Or Face Financial Train Wreck
http://www.prisonplanet.com/articles/january2008/012308_crash_now.htm

Market’s Wild Ride Ends With Dow at 15-Month Low
http://www.nytimes.com/2008/01/22/business/23cnd-stox.html?hp

Fed Rate Cut Seen As Once In A Generation
http://www.iht.com/bin/printfriendly.php?id=9418610

Federal Reserve slashes US rates on day when ‘chaos reigned supreme’
http://www.guardian.co.uk/business/2008/jan/22/useconomy.marketturmoil1

World’s Largest Bond Insurers Collapsing!
http://www.moneyandmarkets.com/Issues.aspx?NewsletterEntryId=1381

Tuesday Could Bring 1,000 Point Drop in Dow
http://www.247wallst.com/2008/01/a-1000-point-dr.html

All signs point to U.S. consumers hunkering down in recession bunkers
http://www.theglobeandmail.com/serv.ZA18/TPStory/Business

Foreigners Buy Stake In USA At Record Pace
http://www.nytimes.com/2008/01..partner=MYWAY&pagewanted=print

Bank of America net sinks 95 percent
http://www.reuters.com/articl..r=1&virtualBrandChannel=0&sp=true

Oil falls below $89 as stock markets plunge
http://biz.yahoo.com/rb/080121/markets_oil.html?.v=1

Horror day for Australian stock market
http://www.news.com.au/story/0,23599,23089611-2,00.html

Russian shares tumble as panic grips world markets
http://www.russiatoday.ru/business/news/19933

Current financial crisis was topic of Bilderberg 2006
http://rinf.com/alt-news/new-world-..s-topic-of-bilderberg-2006/2277/

The Coming Global Depression
Bear Stearns: The Fed Will Cut Rates AGAIN Next Week
World stock markets fall
Hopes of global rate cut sparks FTSE revival after early morning slump
Black Monday: recession fears spark global share crash
Biggest fall in shares since September 11
When governments print money, buy gold
Gold rallies back to the 890 usd mark after emergency Fed rate cut
Stocks Plunge Despite Fed Rate Cut
Surprise rate cut sparks dollar sell-off
Global markets dropped 5% overnight
Market drops on recession fear
Wall Street set to open lower
Wall St execs collect $US33b bonuses
Asian Markets Continue Slide
Futures plunge on U.S. recession fears
US recession fears wipe £77bn from London shares
Recession fears weigh on markets
Emergency: Global Financial Markets Collapsing
HK shares dive, China plays in worst day in 10 yrs
Will the Economic Crash Wake People Up?
U.S. slide an expanding threat
Britain Unveils Northern Rock Buy Out Plan
CFR: The ‘Historical Anomaly’ of the Dollar
Banks to suffer into ’09 as credit crunch drags: S&P
Tax Rebates Urged To Rescue Economy
U.S. economy teeters on the brink
7-Year Plan Aligns Europe With U.S. Economy

U.S. Economic Collapse News Archive

 



Gordon Brown calls for New World Order

Gordon Brown calls for New World Order

ITN
January 21, 2008

Fbiiraqisbein_mn

The Prime Minister has called for a radical reform of international institutions ranging from the United Nations to the World Bank.

In a speech to business leaders in the Indian capital New Delhi, Mr Brown said the UN Security Council should be expanded to include places for nations such as India, and the International Monetary Fund (IMF) should have a new “early warning” role to head off crises such as Northern Rock.

“To succeed now, the post-war rules of the game and the post-war international institutions must be radically reformed to fit our world of globalisation” – Gordon Brown

He also said the World Bank should focus more on increasing clean energy and the environment.

He said: “To succeed now, the post-war rules of the game and the post-war international institutions must be radically reformed to fit our world of globalisation.

“We can and must do more to make our global institutions more representative and I support India’s bid for a permanent place, with others, on an expanded UN Security Council.

“And I support changes to the IMF, World Bank and the G8 that reflect the rise of India and Asia.”

Mr Brown went on to suggest all countries strengthen networks of global law enforcement authorities, intelligence agents, police and financial regulators, in a bid to combat terrorism worldwide.

And to tackle the problem of struggling states, Mr Brown propsed a UN envoy be appointed to failing nations to coordiinate peacekeeping and recovery after conflict.

The speech was billed by aides as a “significant” statement of his views on a new world order.

They also said that the UK believes Brazil, Japan, Germany and an African country should be allowed to join the UN Security Council.

After the speech, Mr Brown was awarded an Honorary Doctorate of Letters at the University of Delhi – a sprawling campus with 250,000 students.

The Prime Minister joked: “I was once, before I descended into politics, a university lecturer myself. Universities should always stand for objectivity, for rationality, for the honest pursuit of the truth: all the qualities you have to leave behind when you go into politics.”

Gordon Brown and U.N. to Create New World Order
http://news.independent.co.uk/world/article3356210.ece

Brown Prepares to Sell UK Out to Globalist EU
http://www.truthnews.us/?p=1740

World Leaders in Secret Talks to Create ‘New World Order’
http://news.independent.co.uk/world/article3356210.ece

Elite To Attend World Economic Forum
http://news.independent.co.uk/world/article3356210.ece

Conference Promotes Global Citizenship
http://www.wausaudailyherald.com/apps/p..1210466/1981

New World Order Quotes
http://nwsarchive.wordpress.com/2007/09/30/new-world-order-quotes/

 



Greenspan Joins Firm That Bet Against US Housing Market

Greenspan joins firm that made billions betting against the housing market

Reuters
January 15, 2008

Fbiiraqisbein_mn

Hedge fund manager John Paulson, who earned billions of dollars last year by betting against the housing market, said on Tuesday that former Federal Reserve board chairman Alan Greenspan will advise his firm.

Greenspan, whose words can still move financial markets, will advise Paulson on the global economy for an undisclosed amount of money, the hedge fund said in a statement.

By joining the New York-based fund, Greenspan becomes the latest former Washington insider to work in the fast growing $2 trillion hedge fund industry. Former Treasury Secretaries Lawrence Summers and John Snow provide advice to D.E. Shaw and Cerberus.

 

Goldman Sachs Hints at $1000 Gold and $135 Oil

24/7 Wallstreet
January 16, 2008

Goldman Sachs is RAISING ITS 2008 GOLD FORECASTS factoring for a recession in the U.S. in both Q2 and Q3 2008, leading to a weaker U.S. Dollar target of $1.51/Euro (up from $1.35) over the next six months. The prior $800/ounce gold target is now put at an average of $915/ounce for all of 2008, with an exit 2008 commodity price of $850 (up from $825 prior). The call is based on support from investment demand, purchases from emerging market central banks, and the ongoing declining mine supplies.

Goldman Sachs is also raising its 2009 and 2010 gold prices:

2009 prices are now expected to be $870/ounce (up from $852);
2010 prices are now expected to be $940/ounce (up from $907);

Near-term Goldman Sachs notes a possibility of a spike past $1,000.00 that could be the effect of further credit events and increases in oil prices.

Read Full Article Here

Related News:

Shares in freefall a Dollar tumbles to 2-1/2 year low vs. yens recession hits
http://money.cnn.com/200..llar.ap/index.htm?postversion=2008011605

Shares in freefall as recession hits
http://www.financemarkets.c..s-in-freefall-as-recession-hits/

ECB warns crashing dollar may stop Fed cuts
http://www.telegr..14/bcnfedcut114.xml&CMP=ILC-mostviewedbox

Top economist blames Fed for sub-prime crisis
http://www.telegraph.co.u..=/money/2008/01/13/ccschwartz113.xml

Inflation Up by Largest Amount in 17 Years
http://www.foxbusiness.com/mar..se-03-december_438734_3.html

Citigroup May Write Down Up To $24 Billion, Lay Off 20,000 Workers
http://www.cnbc.com/id/22639976/

Wall Street braces for more losses
http://money.cnn.com/..m?postversion=2008011608

Shadow spreads across the US economy
http://www.theaustralian.new..197,23046413-5015025,00.html

Transit Panel Urges Gas Tax Increase
http://news.aol.com/story/_a/tran..rease/n20080115033009990021

Bankers Throw In Towel On Northern Rock
http://www.telegraph.co.u..oney/2008/01/12/cnnrock112.xml

“U.S. Economy Screwed”: Henry Blodget
http://www.alleyinsider.com/2008/01/us-economy-screwedexperts.html

Largest Saudi Bank Urges Dollar Depeg
http://www.ft.com/cms..ac.html?nclick_check=1

Crisis may make 1929 look a ‘walk in the park’
Wholesale Prices Up 6.7% In 2007
Breaking phase ahead for the global financial system in 2008
Traders betting oil will hit $200 a barrel in 2008
Gold Futures Rise to Record $900.10
Weaker dollar likely to push gold over $1,000-mark

U.S. Economic Collapse News Archive

 



Fed promises as much money as the banks want

Fed promises as much money as the banks want
Fed Has Auctioned Another $20B in Funds to Commercial Banks to Combat Credit Crunch

AP
December 21, 2007

The Federal Reserve, working to combat the effects of a severe credit crunch, announced Friday it had auctioned another $20 billion in funds to commercial banks at an interest rate of 4.67 percent. Fed officials pledged to continue with the auctions “for as long as necessary.”

The central bank said it had received bids for $57.7 billion worth of loans, nearly three times the amount being offered, indicating continued strong interest in the Fed’s new approach to providing money to cash-strapped banks.

It was the second of four scheduled auctions. The first auction, on Monday, of $20 billion resulted in loans being awarded at an interest rate of 4.65 percent. There were 93 bidders seeking $63.6 billion at the first auction and 73 at the second.

Two more auctions will occur in early January. In a statement Friday, the central bank said it would continue with further auctions “for as long as necessary to address elevated pressures in short-term funding markets.”

The new auction process was announced by the Fed last week in a coordinated action with central banks around the world trying to address a global credit crunch.

Federal Reserve Chairman Ben Bernanke and his colleagues decided to try the new process because their efforts to inject funds into the banking system through the Fed’s discount window, which makes direct loans to banks, had proven less successful than Fed officials had hoped.

Many banks had avoided using the Fed’s discount window out of concern that investors would see the move as an indication of underlying problems at their financial institutions.

The auction process was developed as a second way to get money into the banking system with the hopes that it would not carry the stigma of the discount window.

The Fed said Friday that it would announce on Jan. 4 the sizes of the next two auctions which will be held Jan. 14 and Jan. 28. Officials have said the Fed will evaluate the interest in the auctions after the initial four and determine whether more auctions will be scheduled.

The new auction results cover short-term loans for 35 days.

The global credit crisis has made banks reluctant to lend to each other even as the Fed has been lowering its federal funds rate, the interest that banks charge each other for overnight loans.

The rate currently stands at 4.25 percent, a full percentage point lower than it was in September when the Fed began slashing rates in the wake of a severe credit squeeze that had roiled global markets in August.

The 4.67 percent rate for the second $20 billion in funds and the 4.65 percent rate for the first auction means that banks who are using the auction process to get needed reserves are getting them at a rate slightly below the 4.75 percent rate they could get in direct loans through the discount window.

The Fed cut the federal funds rate and the discount rate by a quarter-point at its last meeting on Dec. 11, disappointing investors who had hoped for a bigger half-point reduction in the funds rate.

Many economists believe the Fed will keep cutting rates with three more quarter-point reductions expected in the funds rate at the Fed’s first three meetings of the new year.

Analysts believe that a serious slowdown in overall economic growth will force the Fed to continue cutting rates even though some Fed officials have expressed worries that the rate cuts could exacerbate inflation pressures, which have flared up again, reflecting a renewed surge in oil prices.

 

People & Power – Death of the dollar

http://www.youtube.com/watch?v=54MUm2P1jOU

http://www.youtube.com/watch?v=HdrNbhdl7uU

Growing number of Americans expect recession: poll
http://www.reuters.com/article/ousiv/idUSN1821436620071219

Gold climbs above $800 in London as dollar drops; silver gains
http://www.tehrantimes.com/index_View.asp?code=159758

Northern Rock Rescue Cost $100B
http://www.fmnn.com/WorldNews.asp?nid=52822

US Inflation Soars – Largest Rise in Producer Prices Since 1973!
http://www.marketoracle.co.uk/Article3128.html

US foreclosure filings up 68 pct in Nov.
http://news.yahoo.com/s/ap/20071219/ap_on_bi_ge/foreclosure_rates

U.S. Dollar’s Credibility Being `Stretched,’ UBS Economist Says
http://www.bloomberg.com/apps/news?pid=20601…o4&refer=home

US Federal Reserve’s subprime regulations shield Wall Street banks
http://www.wsws.org/articles/2007/dec2007/mort-d21.shtml

Economy teeters on brink, says Resler
http://www.marketwatch.com/news/mailto.a…&siteid=mktw

GAO Says Government Failed Yet Another Financial Audit
http://www.govexec.com/story_page.cf…2&dcn=todaysnews

One in Five Americans Must Borrow to Heat Homes This Winter
http://www.alternet.org/blogs/peek/71071/

Morgan Stanley secures $5bn from China
http://www.telegraph.co.uk/money/main.j….9/bcnmorgan119.xml

CNN: Ron Paul Says U.S. Going Broke
http://www.youtube.com/watch?v=lP6MtMq5cBw

ECB Offers Banks Unlimited Funds
http://news.bbc.co.uk/2/hi/business/7149329.stm

Overstock.com CEO warns of depression
http://www.youtube.com/watch?v=m-TLfmLTiqA

U.S. Economic Collapse News Archive

 



World Stocks Plummet Despite Infusion

World stocks plummet after global banks take action in bid to avoid recession

Daily Mail
December 13, 2007

Stocks worldwide have plummeted in the wake of yesterday’s unprecedented decision by leading central banks to pump billions into money markets in a bid to avoid a worldwide recession.

The Bank of England has joined the U.S. Federal Reserve, the European Central Bank and their counterparts in Canada and Switzerland to pump at least £55billion into money markets.

However this morning the FTSE 100 fell more than 70 points to 6458.7 and the markets in Japan, Hong Kong and Taiwan all suffered nervous starts to the day’s trading.

Investors are worried that the shock decision by the world’s banks could mean that the credit crisis is likely to get worse.

It is hoped that the loans – £ 22.7billion of which will go to the UK – will help make lending between banks easier, avoiding any repeat of the Northern Rock crisis.

The Rock ran into trouble because the current economic climate has encouraged banks to hoard their cash, rather than lend it to each other.

Read Full Article Here

 

Russia to dump waning dollar

Press TV
December 14, 2007

Russian oil firm Rosneft will follow the lead of Gazprom and LUKOIL to sell crude in rubles amid the ongoing depreciation of the dollar.

“Our specialists are looking at all possibilities that could be beneficial for the company,” Rosneft Spokesman Nikolai Manvelov said. “Everything depends on economic viability.”

Russia’s largest independent oil producer, LUKOIL earlier announced that the company will switch to the ruble in its gas and crude deals within two years.

“Selling for rubles is much more attractive,” Deputy Chief Executive Officer Leonid Fedun said on December 12. “Gazprom is considering introducing ruble-denominated contracts and I think that technically Russian companies can do it by 2009 if the banks are ready.”

“We consider the idea of selling our resources for rubles to be quite possible,” Gazprom’s Vice President Alexander Medvedev said at a recent conference in New York.

Last month, Iran and Venezuela proposed to the Organization of Petroleum Exporting Countries (OPEC) to switch to a basket of currencies in its oil deals.

Iran, the world’s fourth most prolific oil exporter, has already abandoned the dollar, Iran’s Oil Minister Gholam-Hossein Nozari said on December 9, describing the currency as unreliable.

U.S. Stocks Decline as Fed Fails to Assuage Recession Concern
http://www.bloomberg.com/a…yi2xynL0&refer=us

Report Says That the Rich Are Getting Richer Faster, Much Faster
http://www.nytimes.com/2007/…ThcWg&oref=slogin

LA Times Says Gold For Conspiracy Theorists
http://www.latimes.com/wireless/avantgo/la-fi-gold16dec16,0,465745.story

Fed To Announce New Mortgage Rules
http://www.washingtonpost.co…007121401875.html

‘A financial tsunami is upon us’: Schultz sees an apocalypse now
http://www.marketwatch.com/new.34-A49..dist=TNMostRead

Mortgage Crisis Inflicts Collateral Damage
http://www.msnbc.msn.com/id/22246203

Schwarzenegger To Declare Fiscal Emergency
http://www.nbc11.com/news/14858065/detail.html

Russia may dump weakening US dollar in its energy deals
http://www.dailyti…2007%5C12%5C15%5Cstory_15-12-2007_pg5_43

Money-Market Rates Fail to Respond to Bank Measures
http://www.bloomberg.com/apps/news?…d=a9anSVhH.NOQ&refer=home

November Consumer Prices Rise More than Forecast
http://www.bloomberg.com…4BNlo&refer=home

Greenspan: Odds of recession ‘clearly rising’
http://noworldsystem.com/2007/…ession-clearly-rising/

Central Banks to Pump Billions into World Financial System
http://www.nytimes.com/200..8-8QuVU5oMlm5w8E6dIl7JlQ

GAO: “USA is living beyond its means”
http://www.youtube.com/watch?v=KjZBOCAgR64

U.S. Economic Collapse News Archive