Fed has Pumped $314 Billion Into Foreign Central Banks

Bernanke has clearly gone mad.

For more than a year, the U.S. Federal Reserve System has been increasingly acting as the world's central bank, injecting hundreds of billions of dollars into foreign government treasuries in an effort to increase liquidity in those countries, Ryan Grim reports.

Grim continues:

The foreign central banks have used the U.S. currency to bail out financial nstitutions within their borders. The Fed program links its balance sheet directly to the fates of foreign central banks at a time when they're on the ropes.

The program has so far gone unreported in the mainstream media and is a major expansion of Federal Reserve involvement in the global economy...In exchange for U.S. dollars, the Fed has received foreign currency of equivalent value in an exchange known as a swap...The swaps are listed by the Fed on its balance sheet as "central bank liquidity swaps." The only reference to such swaps in Nexis or Google News comes in the trade paper Market News International, which publishes periodic summaries of fluctuations in the Fed balance sheet. The Fed hasn't hid the exchanges and even sports an FAQ about the transactions on its Web site.

The Fed has established relationships with some major banks, such as the European Central Bank and the Bank of Japan, but also with central banks overseeing smaller, more volatile economies, such as the Banco Central do Brasil...

The full list of participating banks, according to the Fed, includes the Reserve Bank of Australia, Bank of Canada, Danmarks Nationalbank, Bank of England, Bank of Korea, Banco de Mexico, Reserve Bank of New Zealand, Norges Bank, Monetary Authority of Singapore, Sveriges Riksbank, and Swiss National Bank.

As I have pointed out before, it is going to be serious global inflation.

ViaLRtwitter