The Federal Reserve is Secretely Bailing out Europe ( Archived) (31)

Former High-Level Federal Reserve Official: Fed Secretly Bailing Out Europe. Federal Reserve chair Ben Bernanke told Congress that the Fed would not bail out Europe.
But he might have been less than forthcoming.
Former Vice President of the Federal Reserve bank of Dallas, Gerald ODriscoll, says that the Fed is secretly doing just that.

O’Driscoll wrote in a Wall Street Journal editorial:

"America’s central bank, the Federal Reserve, is engaged in a bailout of European banks. Surprisingly, its operation is largely unnoticed here.
The Fed is using what is termed a “temporary U.S. dollar liquidity swap arrangement” with the European Central Bank (ECB). There are similar arrangements with the central banks of Canada, England, Switzerland and Japan. Simply put, the Fed trades or “swaps” dollars for euros. The Fed is compensated by payment of an interest rate (currently 50 basis points, or one-half of 1%) above the overnight index swap rate. The ECB, which guarantees to return the dollars at an exchange rate fixed at the time the original swap is made, then lends the dollars to European banks of its choosing."
The two central banks are engaging in this roundabout procedure because each needs a fig leaf. The Fed was embarrassed by the revelations of its prior largess with foreign banks. It does not want the debt of foreign banks on its books. A currency swap with the ECB is not technically a loan.


And the shenanigans continue... More cooking of the books

Gee what else is new.

Gee... As a European what can I say...?

Thank you guys?

Thank you, then, thanks a lot for once again saving our butt...

I don't actually think it was a secret, just was not publicized to a great extent.

No one said it was a secret. They did try to keep it hush-hush though. If it had been a secret do you think it'd be on CS??

Sure it would! Conspiracy Theory! Don't forget the "Theorists" always have to have something!!!!!

What Terrorists? D'you see any terrorists? Where?