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MOSLER'S LAW: There is no financial crisis so deep that a sufficiently large tax cut or spending increase cannot deal with it.

ECB taking lower quality collateral vs USD lending

Posted by WARREN MOSLER on October 20th, 2008

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Trichet urges banks to lend after recovery begins (Update2)

By Simon Kennedy and Anne-Sylvaine Chassany

Trichet acknowledged his own central bank had taken on risk by boosting liquidity and accepting lower-rated securities as collateral for loans.

``We're taking risks and we've made decisions that increased our risks, because we were facing a systemic liquidity crisis of first importance,'' he said. The ECB is an ``inspirer of confidence,'' Trichet said.

Yes, and now with the Fed's money via the swap lines, and into a slowing economy.


One Response to “ECB taking lower quality collateral vs USD lending”

  1. hooverprintingpresses Says:

    “Yes, and now with the Fed’s money via the swap lines, and into a slowing economy.”

    Warren, as a western citizen protected by US military forces on some US islands, what is the big deal if the credit of the US gubbment vaporizes and everyone leaves the US bowling alley to go play in some bowling alley elsewhere? The Fed’s money is your money too right? If they destroy the purchasing power of all that bowling score you got in your wallet – why sweat it? There are bigger goals out in the universe than warren mosler’s purchasing power isn’t there?


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