Fed Pours $200B Into Global Credit Relief Push

Central banks around the world try to ease liquidity problem
By Kevin Spak,  Newser Staff
Posted Mar 11, 2008 10:15 AM CDT
Specialist Evan Soloman, left, and trader Jon Corpina interact on the floor of the New York Stock Exchange, Friday, March 7, 2008. Stocks bounced around Friday after the government's much-anticipated...   (Associated Press)
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(Newser) – The Fed will inject huge quantities of cash into financial markets as part of a coordinated global attack on the credit crisis, Ben Bernanke announced today. The central bank will loan out another $200 billion, this time on a 28-day basis rather than overnight, the AP reports. The effort will coordinate with the European Central Bank and the central banks of Canada, England, and Switzerland.

The Fed said it acted "to promote liquidity in the financing markets for Treasury and other collateral and thus to foster the functioning of financial markets more generally." The new loans are a new tool, a Term Securities Lending Facility, and will be available by auction once a week starting March 27. The Fed has also bolstered the dollars that can flow to the ECB through “swap lines.”