
In order to “kick the can down the road” yet one more time, and to provide three more months for the Europeans to find a way to keep Greece from defaulting, the Fed is setting up a “liquidity swap program” with four foreign central banks — the ECB, the Bank of England, the Bank of Japan, and the Swiss National Bank. The Fed sets up “swap lines” with the foreign banks, exchanging their currency for dollars, with an agreement that the foreign banks have to exchange back at a fixed date, after three months in this case. Thus, the Europeans now have enough dollars to last them until the end of the year. Reuters and Federal Reserve
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