As Applicants Line Up, Is Fed Near Its Limit? [ANALYSIS] ·
As the Federal Reserve debates whether or not to grant bank status to GMAC Financial Services, analysts contend the central bank risks perverting the traditional bank holding company charter, which was never meant to serve as a safe haven for companies in trouble. (American Banker)
October 30, 2008
Federal Reserve
AIG Taps Fed Facility To Repay U.S. Loan ·
American International Group repaid $6.8 billion of a $123 billion U.S. government credit line by borrowing from the Federal Reserve's commercial paper facility on Thursday. (Reuters)
Asian, European Stocks Rally On Rate Cuts ·
Global markets rallied Thursday as Asian and European central banks echoed the Federal Reserve's Wednesday rate decision with cuts of their own. In Asia, Japan's Nikkei 225 index rose 10% while Seoul's Kospi index soared 12%. (NYT)
Lucas: “Bean Accounting” For Federal Bailouts [OPINION] ·
Economist Deborah Lucas argues that the U.S. government holds itself to less stringent accounting standards than it imposes on the private sector, cautioning that its methods could distort the value of securities it buys from troubled financial institutions. (Kellogg Insight)
U.S. Stocks Lose Ground On Bleak Fed Outlook ·
The Dow Jones Industrial Average failed to sustain a 300 point rally Wednesday, closing down 74 points after the Federal Reserve tempered a half percentage rate cut with a bleak forecast for exports and consumer spending. (CNN Money)
Fed Lowers Target Rate To 1% ·
The Federal Reserve cut its target interest rate by 50 basis points Wednesday to 1%, the lowest level in four years, warning that economic activity has "slowed markedly" on the heels of declining consumer spending. (NYT)
U.S. Markets Soar On Hopes For Fed Rate Cut ·
U.S. stocks soared Tuesday afternoon as investors rushed to buy bargain-priced equities ahead of the Federal Reserve's monetary policy meeting Wednesday. The Dow Jones Industrial Average climbed 889 points, or 10.9%, to close above 9,000 for the first time in a week. (NYT)
Fed Sets Deadline For CDS Regulation Proposals ·
The Federal Reserve has reportedly given CME Group, Intercontinental Exchange, and other futures exchanges until October 31st to detail proposals for reducing risk in the $55 trillion credit default swaps market. (Bloomberg)
GE Tests Fed’s New Commercial Paper Facility ·
General Electric borrowed roughly $5 billion from the Federal Reserve on Monday in an effort to show support for its new commercial paper facility. The industrial conglomerate is the largest borrower in the $1.5 trillion commercial paper market with an estimated $88 billion in short-term loans. (FT)
DJIA Loses 203 After Late Session Plunge ·
The Dow Jones Industrial Average failed to sustain an afternoon rally Monday closing down 203 points, or 2.4%, as investors moved anxiously to the sidelines before the Federal Reserve's highly anticipated monetary policy meeting Tuesday. (CNNMoney)
Setser: The Case For A Bigger IMF [OPINION] ·
Economist Brad Setser of the Council on Foreign Relations calculates that the International Monetary Fund's current lending capacity of roughly $200 billion makes it too small to operate effectively at the center of the international financial system. (Follow the Money)
Feds Question Hedge Fund Counterparties ·
Federal Reserve officials have reportedly questioned Wall Street counterparties in the past few days about their debt exposure to Citadel Investment Group and Sankaty Advisors. Regulators are examining whether the funds could pose a threat to the broader financial system. (WSJ)
More Rate Cuts Likely, Record Low In Sight [ANALYSIS] ·
Some analysts forecast the Federal Reserve will have to lower its target interest rate below 1% next week, arguing that the central bank has little choice but to "inflate" its way out of the financial crisis. (CNNMoney)
El-Erian: “Sell and Get Out of the Way” [OPINION] ·
Pimco's Co-CEO Mohamed El-Erian said Friday "a market washout will be a critical and historic step in getting the debris out of the stock market," and forecast that the Federal Reserve will have to step in within the next few days to cut interest rates. (CNBC)
GE To Tap Fed’s Commercial Paper Facility Next Week ·
General Electric, the biggest U.S. issuer of commercial paper, confirmed it will tap the Federal Reserve's new short-term funding facility next week to demonstrate "support" for the central bank's recent liquidity measures. The company did not confirm the amount it plans to borrow. (Bloomberg)
