Bernanke prints money for Europe!! We get the tax!! (interstates, wage, salary)
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I always stated that I am in the forum to learn, I have not the slightest idea what this means :
The Federal Open Market Committee has authorized an extension of the existing temporary U.S. dollar liquidity swap arrangements with the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank through February 1, 2013. The rate on these swap arrangements has been reduced from the U.S. dollar OIS rate plus 100 basis points to the OIS rate plus 50 basis points.
I would highly appreciate if someone could dumb this down for me and explain.
as i understand it --
we're accepting some of our trading partners' bond risk (Japan, Europe, Canada), in exchange for some of our own bond risk. Bond risk, being one way of measuring "inflation."
It is a way of spreading out the risk of interest rate changes (and thus stabilizing currency fluctuations) across multiple economies with different currencies.
we're accepting some of our trading partners' bond risk (Japan, Europe, Canada), in exchange for some of our own bond risk. Bond risk, being one way of measuring "inflation."
It is a way of spreading out the risk of inflation across multiple economies with different currencies.
Which are all tied back to the US Dollar. Meaning it is just smoke and mirrors.
Commodities and metals will rise in cost.
This will be a hit on the poor & middle classes the most.
Which are all tied back to the US Dollar. Meaning it is just smoke and mirrors.
Commodities and metals will rise in cost.
This will be a hit on the poor & middle classes the most.
i don't really know.
i mean obviously the European banks are in serious trouble due to european soveriegn debt. Capital is pulling out of that market, which is making it difficult for europeans to acquire dollars. I'm not sure what role the yen plays in this, they want to weaken their currency as i understand it.
but to me there's nothing wrong with accepting some of the risk of Canadian and Swiss interest rate risk, in exchange for American dollar interest rate risk.. assuming i'm understanding this correctly.
Last edited by Cletus Awreetus-Awrightus; 12-01-2011 at 08:59 AM..
i mean obviously the European banks are in serious trouble due to european soveriegn debt. Capital is pulling out of that market, which is making it difficult for europeans to acquire dollars. I'm not sure what role the yen plays in this, they want to weaken their currency as i understand it.
but to me there's nothing wrong with accepting some of the risk of Canadian and Swiss interest rate risk, in exchange for American dollar interest rate risk.. assuming i'm understanding this correctly.
Found this article saying about the same thing :
Quote:
The Federal Reserve, the European Central Bank, the Bank of England, the Bank of Canada, the Bank of Japan and the Swiss National Bank have announced a coordinated plan to provide liquidity support to the global financial system. According to the plan, the Federal Reserve is going to substantially reduce the interest rate that it charges the European Central Bank to borrow dollars. In turn, that will enable the ECB to lend dollars to European banks at a much cheaper rate.
That is a good dumb downed version for me.
Here is some info that I been kicking around in my head about inflation, you know how it goes more USD in circulation chasing around the same amount of goods. Then there is this :
Quote:
Neither the dollars nor the Euros come from anywhere. They aren’t moved or debited from anywhere. They are invented right on the spot with a few taps on the key pad. And that’s all. There’s no printing press fired up to make new dollars or euros. This is sometimes called “fiat money.” But that makes it sound as if some command from a sovereign created the money. It’s really closer to “keyboard money,” since it is created by data entry in a computer.
It's not like Uncle Ben was up all night printing USD and shipped it out Fed Ex over night. The supposed USD is not even in circulation it is just a computer entry at this point. All this is like a obnoxious cyber monopoly game that can give a person a headache thinking about it.
Zerohedge has an article about this latest big move by central banks. Even China got involved.
Could have been one of the big European banks not able to make its liquidity demands.
This could have been a stealth bailout of a big European bank.
Actually If we make loans, we get to collect the interest. What are you talking about?
But if we have to borrow the money to provide the money to make the loan we have to pay interest.
The US does not have a surplus.
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