Tag Archives: exchange

Foreign Currency Exchange Swap Lines – What Central Banks are Whispering?

In response to continued strains in short-term funding markets, Central Banks across the world have coordinated actions to significantly expand the capacity to provide U.S. dollar liquidity. Central banks publicly commit to continue to work together closely and say they are prepared to take appropriate steps as needed to address funding pressures.

This should serve to drive up the value of the dollar on the short-term (for a month or so) until fear and panic eventually take hold and Central Banks one by one begin dumping dollars.

That being said, there are some short-term possible gains for those who invest in the dollar and substantial long-term gains for those who sell dollars while they are high and opt to invest and protect their savings in strong currencies such as the Euro and Chinese yuan. Of course a safe haven for consumers and investors with less intestinal fortitude would be gold.

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The U.S. Federal Reserve announced several initiatives to support financial stability and to maintain a stable flow of credit to the economy during this period of significant strain in global markets.

The Fed commits to continue to adapt these liquidity facilities as necessary and will keep them in place as long as circumstances require.

Actions by the Federal Reserve include:  (1) an increase in the size of the 84-day maturity Term Auction Facility (TAF) auctions to $75 billion per auction from $25 billion beginning with the October 6 auction, (2) two forward TAF auctions totaling $150 billion that will be conducted in November to provide term funding over year-end, and (3) an increase in swap authorization limits with the Bank of Canada, Bank of England, Bank of Japan, Danmarks Nationalbank (National Bank of Denmark), European Central Bank (ECB), Norges Bank (Bank of Norway), Reserve Bank of Australia, Sveriges Riksbank (Bank of Sweden), and Swiss National Bank to a total of $620 billion, from $290 billion previously.

These steps are being undertaken in an attempt to mitigate pressures evident in the term funding markets both in the United States and abroad.  The Federal Reserve’s actions are desiring to reassure financial market participants that financing will be available against good collateral, which they hope will lessen concerns about funding and rollover risk.

84-Day Maturity TAF Auctions
The increase to $75 billion per auction will triple the supply of 84-day maturity credit to $225 billion from $75 billion.  TAF credit at the 28-day maturity will remain at $75 billion.  The total amount of TAF credit available in the 28-day and 84-day auction cycles will double to $300 billion from $150 billion.

Foreign Exchange Swap Lines
The Federal Open Market Committee (FOMC) has authorized a $330 billion expansion of its temporary reciprocal currency arrangements (swap lines).  This increased capacity will be available to provide funding for U.S. dollar liquidity operations by the other central banks.  The FOMC has authorized increases in all of the temporary swap facilities with other central banks.  These larger facilities will now support the provision of U.S. dollar liquidity in amounts of up to $30 billion by the Bank of Canada, $80 billion by the Bank of England, $120 billion by the Bank of Japan, $15 billion by Danmarks Nationalbank, $240 billion by the ECB, $15 billion by the Norges Bank, $30 billion by the Reserve Bank of Australia, $30 billion by the Sveriges Riksbank, and $60 billion by the Swiss National Bank.  As a result of these actions, the total size of outstanding swap lines is $620 billion.

All of the temporary reciprocal swap facilities have been authorized through April 30, 2009.

Dollar funding rates abroad have been elevated relative to dollar funding rates available in the United States, reflecting a structural dollar funding shortfall outside of the United States.  The increase in the amount of foreign exchange swap authorization limits will enable many central banks to increase the amount of dollar funding that they can provide in their home markets.  This should help to improve the distribution of dollar liquidity around the globe. Whether the value of the dollar holds on the long term against inflation and deflation however is highly unlikely.

That being said, there are some short-term possible gains for those who invest in the dollar and substantial long-term gains for those who sell dollars while they are high and opt to invest and protect their savings in strong currencies such as the Euro and Chinese yuan. A more cautious and safe route for consumers and investors is also found in the safe haven of gold.

http://www.bullionvault.com/#paulfdavis

http://ads.easy-forex.com/Gateway.aspx?gid=104994

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Filed under america & politics, American economy, american people, banking, bankruptcies, banks governors, central banks, currency, death of the dollar, deflation, dollar, dying dollar, economic stabilization, economy, exchange, finance and economics, finance ministers, financial markets, financial meltdown, foreign, swap lines, wall street, wall street woes, wealth and prosperity, worldwide financial meltdown

Blockbuster And Netflix Unethical Contracts – Corporation Nation & Crude Capitalism, A New America

Blockbuster Online decided to alter and modify my existing movie rental contract, which initially allowed me unlimited rentals and exchanges at the store for a fixed price. On October 17, 2007 when I walked into the store to exchange a video the store rep told me I had met my limit for monthly exchanges and would have to pay over $2.00 per movie on any additional exchanges. The manager came out and agreed it was bogus and fraudulent, but said he couldn’t change it.

Upon looking at Blockbuster Online they have since phased out unlimited rentals altogether on their website, but such was in operation when I was sold the contract by the Blockbuster representative.

I phoned the competition at Netflix who told me they only lowered their prices, unlike Blockbuster who has since significantly raised their prices. The idea according to my research is for Blockbuster to put the competition out of business for a short while by their online services, than alter their contracts after the competition has been eliminated – kind of like an anti-trust price gouging operation.

The Netflix website contract for similar services, which verbally the rep on the phone said there would not be any price increases……says otherwise. Read the fine print online and you will see a contractual stipulation stating “changes to terms of use.”

Changes to Terms of Use
Netflix, Inc., reserves the right, from time to time, with or without notice to you, to change these Terms of Use in our sole and absolute discretion. The most current version of these Terms of Use can be reviewed by clicking on the “Terms of Use” located at the bottom of the pages of the Netflix Web site. The most current version of the Terms of Use will supersede all previous versions. Your use of the Netflix Web site or continued use of our service after changes are made means that you agree to be bound by such changes.

This is the new corporation nation which cares not for consumers but financially raping and taking advantage of us. I say let’s protest!

Write your Better Business Bureau and Congress representatives and cite these unethical billing practices and procedures. What we tolerate will dominate. Close the floodgates before capitalism overtakes we the people and honesty and integrity entirely leaves the marketplace.

Tonight on May 24th, 2008 when I went into Blockbuster’s store I noticed the computer conveniently reduced my monthly exchanges from 5 to 3 when I recently updated my credit card information. I wonder how many people are being falsely taken advantage of every month by Blockbuster. It sounds to me like a class action lawsuit needs to be initiated soon. Blockbuster is always tipping the scales to screw the consumer and make themselves rich on the sly.

Paul F Davis – worldwide minister, international speaker, and author of United States of Arrogance

http://www.PaulFDavis.com
RevivingNations@yaho.com

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