Free Republic

A day after a dramatic move in interest rates, the Federal Reserve on Monday increased the amount of liquidity it’s offering in short-term lending to the financial industry.In a mid-day announcement, the New York Fed said it will conduct a $500 billion repo operation this afternoon, another move targeted at keeping money flowing through the system. Repo involves banks putting up high-quality collateral like Treasurys in exchange for the liquidity they need to conduct operations.  Monday’s move comes after the Fed stepped up the operations last week, offering up to $1.5 trillion to an industry hungry for the Fed’s offerings.The operation...