Posted by Dan Denning on Sep 28th, 2007
Anyone know if the credit crunch is officially over yet? Just checking.The US Fed was busy pumping US$38 billion into the financial system in the last two days. “The Federal Bank of New York added US$6 billion in 14-day repurchase agreements, US$20 billion in 14-day repurchase agreements, US$7 billion in seven-day repurchase agreements and US$5 billion dollars in one-day repos,” according to wire services.
Yep. Everything is probably fine. Enjoy your bread. Take a look at that circus. Look, it’s Elvis! Hey King!
The Fed is attempting a giant credit transfusion. But its patient, the fat, bloated, ten-year old credit bubble is leaking money in all sorts of directions. We reckon the nominal highs on the Dow are merely maintaining the illusion that things are fine.