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A log scale won't help this chart
Wednesday, July 30, 2008
The Federal Reserve announced this morning that both the Primary Dealer Credit Facility (PDCF) and its Term Securities Lending Facility (TSLF) will be extended in an effort to boost liquidity for a financial system that remains stressed. 
They also noted the introduction of auctions of options on $50 billion of draws on the TSLF and 84-day Term Auction Facility (TAF) loans as a complement to 28-day TAF loans along with an increase in the Federal Reserve's swap line with the European Central Bank to $55 billion from $50 billion.
Monetary policy used to be pretty boring with maybe one or two press releases a month showing up at the Federal Reserve's website consisting mostly of FOMC statements and meeting minutes about every six weeks or so.
That's changed quite a bit, though, the month of July (below) actually appears quite tame compared to other more "acute" periods in the credit crisis over the last year.
Thankfully, in a fiat money system, the lender of last resort doesn't have to worry about running out of money to lend. Do they?
5 comments:
Wow!
I still wonder why gold is just in 850 - 1050 range
the weekly chart on the link shows half of this spike has come back already.
still a huge spike though
How about adjusting for inflation?
How much is your home worth? Well, it all depends where you live.
The real estate market is still shaking. New data suggests that home prices have hit a new record low. In every new study that comes out, homeowners from Miami, to Las Vegas, Phoenix and Los Angeles, have seen their home value go lower every time.
Is that disappointing? Of course it is.
Should we sell? Is not a good time.
Should we stick to it? Yes, if you can.
Have we hit bottom? Nobody knows.
Banks are facing their worst foreclosure crisis.
Don’t take me wrong, it’s good if you are in the market to buy a home for yourself or if you are an investor, but if you are not, and you own a home, most likely the value of your property is down at least 15 %.
Why do banks care if you are loosing your home? By having to sell repossessed homes, banks have to literally slash their prices down. It gets very costly for them, after all, they have to pay property taxes, maintenance costs, and whatever utilities that need to be paid, all of this expenses for a house that it’s just sitting there, vacant, and the bank is getting nothing in return.
The latest study by the S&P/Case-Shiller Home Price Index of 20 cities, revealed the news that for 22 consecutive months home prices dropped. Only from April to May, 2009 the decline was of 0.9 %
150B in today's environment where the government tosses around that much in new giveaways almost monthly is actually not that impressive a number.
I too am amazed at the ability of the public to continue thinking in terms of dollars as if they buy what they did just a few years ago. Gold won't rise much till they are disabused of their fantasies of "life as usual".
A day when the dollar gains a penny sends the markets up wildly. Hope springs eternal.
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