Did the Fed Make an End Run Around Congress ?

[Helena]

Here are two recent news articles... one from AP the other from Bloomberg...
they show two different $630 billion spent the past week... one $630 billion
was injected into the global market by the Federal Reserve just hours before
Congress rejected the $700 billion bailout.






Article from Bloomberg:


Fed Pumps Further $630 Billion Into Financial System

(Update3)


Sept. 29 (Bloomberg) -- The Federal Reserve will pump an additional $630 billion into the global financial system, flooding banks with cash to alleviate the worst banking crisis since the Great Depression.

The Fed increased its existing currency swaps with foreign central banks by $330 billion to $620 billion to make more dollars available worldwide. The Term Auction Facility, the Fed's emergency loan program, will expand by $300 billion to $450 billion. The European Central Bank, the Bank of England and the Bank of Japan are among the participating authorities.

The Fed's expansion of liquidity, the biggest since credit markets seized up last year, came hours before the U.S. House of Representatives rejected a $700 billion bailout for the financial industry. The crisis is reverberating through the global economy, causing stocks to plunge and forcing European governments to rescue four banks over the past two days alone.

``Today's blast of term liquidity will settle the funding markets down, and allow trust to slowly be restored between borrowers and lenders,'' said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. On the other hand, ``the Fed's balance sheet is about to explode.''

entire article at link
Bloomberg.com: Worldwide




Quote from AP article:

WASHINGTON (AP) — The House passed a $630 billion-plus spending bill Wednesday that wraps together a record Pentagon budget with aid for automakers and natural disaster victims, and increased health care funding for veterans returning from Iraq and Afghanistan.

The year-end budget measure also would lift a quarter-century ban on oil drilling off the Atlantic and Pacific coasts. The legislation, which senators are expected to approve and send to President Bush for his signature, is flying under the political radar compared with the White House's contentious plan to bail out Wall Street.

entire article at link
The Associated Press: House approves Pentagon budget, aid to automakers


~

 

[Goonie]

Quote from AP article:

WASHINGTON (AP) — The House passed a $630 billion-plus spending bill Wednesday that wraps together a record Pentagon budget with aid for automakers and natural disaster victims, and increased health care funding for veterans returning from Iraq and Afghanistan.

The year-end budget measure also would lift a quarter-century ban on oil drilling off the Atlantic and Pacific coasts. The legislation, which senators are expected to approve and send to President Bush for his signature, is flying under the political radar compared with the White House's contentious plan to bail out Wall Street.

entire article at link
The Associated Press: House approves Pentagon budget, aid to automakers

IIRC, I heard on the news Saturday that this was part of the normal Federal Gov't budget, and didn't really have anything directly to do with the bailout stuff. Even though it allocates a bunch-a-billion to boost the automakers......$23-24-billion or some such amount.

 

[al_bundy]

i think the bailout is dead and all the hype was a plan to kill hedge funds by driving the price of oil down along with stocks and to kill enough of them to keep the price of oil down

the bailout was so important yet congress is gone for a Jewish Holiday of all things. Charlie Gasparino swore it was going to pass and yet it failed. right after it fails some members talk about raising FDIC limits and bringing back corporate money from overseas for liquidity. why not do it last week? and the rally is caused by the Irish saying they guarantee all deposits. years ago I interviewed at Allied Irish Bank and was told it's mostly corporate business accounts which by coincidence the ones causing the bank runs the last 2 weeks

and just by coincidence today is the last day to redeem your hedge fund shares for cash

 

[Helena]

McCain urges Treasury Department to take action


Tue Sep 30

DES MOINES, Iowa - Republican presidential nominee John McCain is urging the Treasury Department to intervene aggressively to limit damage from the financial meltdown, action that McCain says President Bush can take with the stroke of a pen.

Executive Order ?


Opening a business round-table Tuesday in Des Moines, Iowa, McCain said he has urged the Treasury to use its exchange stabilization fund "as creatively as possible" to backstop the market crisis. He says officials also should use the authority granted in a housing bill to purchase up to a trillion dollars in mortgages.

McCain decried the defeat of the financial bailout measure in the House, and he warned that the nation's political leaders will have to take risks even though solutions to the crisis may be unpopular.


McCain urges Treasury Department to take action - Yahoo! News