Monday, September 15, 2008

Fed Buying Equities

I had to read it twice to really believe if this was true.  People have been talking about PPT and Fed Manipulating the stock markets.  But now, the fed is expanding it's lending program to include Equities!  I am not making this up.

The Federal Reserve will expand its lending facilities in the wake of the likely demise of Lehman Brothers Holdings Inc., taking a wider array of securities, including equities, as collateral for its loans, the central bank said late Sunday.

I had to read it twice to belive it.  With the prices of equities going up and down everyday, how can the fed take it as collateral? 

The fed is expanding lending programs and yet the media keeps talking about fed avoiding the moral hazard.







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