4 Large Banks just borrowed $500 million each:

Discussion in 'Wall St. News' started by capmac, Aug 22, 2007.

  1. Sponger

    Sponger

    Just another way for the Fed to try and calm the markets out of panic mode. You can be sure that Bernanke made the call to the heads of these banks and said "Ladies and gentlemen, we have a potential crisis at hand, and we need your help to alleviate the situation". I cannot recall a time that ANY major bank made a public announcement that they used the discount window. It actually has me more concerned that they made the statements. Then again, this may be a new tactic for the Fed - manipulation of the big money center banks to say "all is well" - might work, might not.
     
    #11     Aug 22, 2007
  2. Sponger

    Sponger

    My thoughts EXACTLY - I typed my first response before seeing yours, nice post.
     
    #12     Aug 22, 2007
  3. dhpar

    dhpar

    i wonder how long the discount window stays opened in the current form. since today it is not bad thing to use it so ultimately everybody will start to flush market with huge amount of cash - it is like huge reverse repo window for lower quality collateral....good thing in a very short term but disastrous if it stays for few months!
     
    #13     Aug 22, 2007
  4. ......because, that works in life. you don't pay attention, let things get out of hand, and hope they get better.

    Works every time.:D

    PS. Guess who picks up the check????:eek:
     
    #14     Aug 22, 2007
  5. Clearly everything is fine now. i just borrowed from the discount window myself and used it to buy RIMM, BCSI AAPL and some futures. They have a jar of mints on the ledge too, take one they are delicious.
     
    #15     Aug 22, 2007
  6. I was gonna take one but I thought those mints were your collateral.
     
    #16     Aug 22, 2007
  7. I guess this is what caused the immediate drop of 6 or 7 spoo points around 12:30 Eastern today.

    And, I don't get the part about being able to borrow $$ elsewhere at a cheaper rate? First off, where? Secondly, if they can, and decide to pay up to the Fed to "take a leadership role..." hmm, makes one wonder whose decision this was...sounds like a Bank shorting opportunity, but who knows.

    Don
     
    #17     Aug 22, 2007
  8. And as traders we are told never to add to a losing position . . .
    hmmmmmm
     
    #18     Aug 22, 2007
  9. dhpar

    dhpar

    i can see the logic here - CEOs of these bank have all big egos. The fact that they are "saving the World" and "Fed's face" at the same time is worth few hundred grand to them. Also when everything is behind us they can always say "hey, that was us who saved you from I don't know what". Remember LTCM? -it is still coming back...
     
    #19     Aug 22, 2007
  10. So what?
     
    #20     Aug 22, 2007