Fed's secret loans to banking giants revealed:
Credit Suisse, Goldman Sachs and Royal Bank of Scotland each borrowed at least $US30 billion ($29 billion) in 2008 from a Federal Reserve emergency lending program whose details weren't revealed to shareholders, members of Congress or the public. Ref. Source 7
Fed planning for potential default
The Federal Reserve is actively preparing for the possibility that the United States could default as a deadline for raising the government's $14.3 trillion borrowing limit looms, a top Fed policymaker said on Wednesday. Ref. Source 1
The Federal Reserve said Tuesday it plans to keep interest rates "exceptionally low" until at least 2013 and acknowledged that the economic recovery is slowing.
The Federal Reserve has kept the federal funds rate near zero for an extended period is to help stimulate the economy. That rate is the central bank's key tool used to spur the economy.
The Fed said growth is "considerably slower" than expected. Ref. CNN
Fed Secretly Loaned $1.2 Trillion in Public Money to Wall St. Firms
By Stephen C. Webster
The U.S. Federal Reserve made approximately $1.2 trillion in loans from public money to support Wall Street firms in the midst of one of the worst financial crises ever. Ref. Source 1
The Federal Reserve pulled the trigger Wednesday on a widely anticipated stimulus move, a policy involving the sale of $400 billion in short-term Treasuries in exchange for the same amount of longer term bonds.
The goal is to push down interest rates on everything from mortgages to business loans, giving consumers and companies an additional incentive to borrow and spend money.
"This program should put downward pressure on long-term interest rates and help make broader financial conditions more accommodative" the Fed said. Ref. CNN
The U.S. Federal Reserve, acting with five other central banks, took steps Wednesday to boost the troubled global financial system by making it cheaper for banks to trade in U.S. Dollars.
The Fed -- along with central banks of the eurozone, England, Japan, Switzerland and Canada -- announced a coordinated plan to lower prices on dollar liquidity swaps beginning on December 5, and extending these swap arrangements to February 1, 2013.
The effort is meant to "ease strains in financial markets," the Federal Reserve said in a press release.
Meanwhile, the People's Bank of China also announced a plan to increase liquidity Wednesday by lowering its reserve requirement ratio for financial institutions by half a percentage point.
U.S. Stock futures surged after the announcement and European markets rose sharply. Ref. CNN