If anything it is a temporary measure to soothe the market.
Its a bit like our Reserve Bank stepping in as "Lender of Last Resort"
In this instance, if the Fed had not stepped in tonights market could have been in meltdown mode.
I posted this excerpt earlier regarding the Fed Statement. ----------------------------------------------------- This is the most important part of the statement.
These changes will remain in place until the Federal Reserve determines that market liquidity has improved materially. These changes are designed to provide depositories with greater assurance about the cost and availability of funding. The Federal Reserve will continue to accept a broad range of collateral for discount window loans, including home mortgages and related assets. Existing collateral margins will be maintained. ----------------------------------------------------- The thing about this is that it is not going to go away. Yes it might help for a short period.
What confidence will it give our markets come Monday if the DOW only trickles across the line tonight?
Even at the moment its only 100pts up.
Whacky times.
Cheers markco2
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