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Two days ago, I wrote here on the widely-reported $30 billion loan that the Federal Reserve made as part of brokering the acquisition of the Bear Stearns Companies by JP Morgan Chase (the "St. Patrick's Day Massacre"). I now have much more information on what this deal is all about. I guessed quite wrong about the deal structure. The $30 billion loan is not a term repo as I originally thought. Nor is it likely to generate monetary losses for taxpayers. (In fact, the opposite is true.)But it is something bold and different that's worth understanding. In fact, it's a...

The U.S. dollar's value is dropping so fast against the euro that small currency outlets in Amsterdam are turning away tourists seeking to sell their dollars for local money while on vacation in the Netherlands. "Our dollar is worth maybe zero over here," said Mary Kelly, an American tourist from Indianapolis, Indiana, in front of the Anne Frank house. "It's hard to find a place to exchange. We have to go downtown, to the central station or post office."

Today's economic condition could likely be seen as "the most wrenching since the end of the second world war," wrote former Federal Reserve chairman Alan Greenspan in the Financial Times on Monday.

Monday, 17 March 2008 Major financial news and emergency Fed meetings on a Sunday? If you had any doubts about how serious the Panic of 2008 is going to be, this should start hinting at how deep we've gotten. Watch Lehman Brothers this week - the brokers are selling it before the market even opens. Early on Sunday (3-16-08) the details of the JP Morgan acquisition of Bear Stearns were released: $220 million, $2 per share. This is pennies on the dollar - or at least the dollars that Bear was claiming to have just a few days ago. Many...

Some folks weigh in on Bear deal and other issues facing the global economy.

Lehman Brothers Holdings Inc. Monday said the bank's liquidity position remains strong, as the fire sale of Bear Stearns to J.P. Morgan to prevent bankruptcy increased speculation that other big U.S. brokerages would come under pressure. "Our liquidity position is and continues to be strong," said Matthew Russell, head of corporate communications for Lehman Brothers Asia Pacific. His statement came after people familiar with the situation said DBS Group Holdings, Southeast Asia's biggest bank by market capitalization, has asked several traders not to enter new transactions with Lehman Brothers.

Asian stocks tumble on Bear Stearns news By KELLY OLSEN, AP Business Writer 39 minutes ago Asian markets plunged and the dollar sank Monday after JPMorgan Chase said it would buy troubled U.S. investment bank Bear Stearns, signaling to investors the depths of the credit crisis. Oil prices hit a record in Asian trading and U.S. stock index futures were down sharply, suggesting Wall Street would open lower Monday after sinking Friday. European shares also opened lower. JPMorgan said Sunday it would acquire Bear Stearns for $236.2 million — or $2 a share — in a deal that represents a...

Pressure is mounting on central banks in the Gulf to fight surging inflation when they meet on Wednesday by severing the link between their currencies and the tumbling US dollar. Officials in Qatar and the United Arab Emirates have denied rumours of an imminent decoupling, but investors are betting on reform and are rushing to buy local currencies as investment banks issue fresh calls for revaluation. Analysts said that, despite the momentum, the Gulf states were unlikely to decouple suddenly from the dollar. They predicted more measured moves towards links to a basket of currencies. “The feeling is [that] unilateral...

(3rd LD) Korean won plunges to 27-month low to greenback SEOUL, March 17 (Yonhap) -- The South Korean currency on Monday tumbled to a 27-month low against the U.S. dollar amid a global credit crunch, raising concerns over a buildup in inflationary pressures. The local currency closed at 1,029.20 won to the U.S. dollar, down 31.9 won from Friday's close and the weakest close since Dec. 12, 2005 when it finished at 1,033.7 won to the greenback. The won's daily loss was the biggest since Aug. 6 1998 when the local currency fell by 70 won to the dollar. The...

Post Comments and thoughts here> Today could be interesting Have a great Saint Paddy's Day the Pubs could be very busy today

The dollar tumbled and stock markets were left reeling after the Federal Reserve unveiled new measures designed to prevent a meltdown in global financial markets and Bear Stearns was sold for $240m. Meeting over the weekend, Fed Chairman Ben Bernanke cut the so-called discount rate at which it is prepared to lend to banks to 3.25pc and said it will lend more to the 20 big banks that make the market for US government debt. Coming a day before the Fed was scheduled to meet on interest rates, the action signals that the central bank is increasingly fearful of an...

Bond debt rates surge The auction-rate bond market has collapsed, with Colorado hit hard. By Aldo Svaldi and Jeffrey Leib The Denver Post Article Last Updated: 03/08/2008 03:54:45 PM MST February was a bad month for Stephanie Doughty, the chief financial officer for Poudre Valley Health System, as interest rates on most of its $215 million in auction-rate bonds climbed steeply, adding as much as $140,000 to weekly interest costs. On Monday, things are expected to get worse when $50 million of that debt goes to auction to face higher rates. "It was just unbelievable, to see such a dramatic...

Japan's Benchmark Nikkei Plunges More Than 3 Percent in Early Trade TOKYO (AP) -- Japan's benchmark Nikkei stock index has plunged more than 3 percent in morning trading. The Nikkei 225 stock index fell 407.81 points, or 3.33 percent, to 11,833.79 on the Tokyo Stock Exchange shortly after the market opened Monday. The index lost 1.54 percent Friday.

WASHINGTON (MarketWatch) -- Acting quickly to prevent a run on major global financial firms, the Federal Reserve cut its discount rate by a quarter percentage point to 3.25% and offered to lend money to a longer list of firms than ever before. he extraordinary weekend moves came as J.P. Morgan Chase sealed a deal to buy Bear Stearns Cos. for just $2 a share backed by funds borrowed from the Fed. The Fed board gave its approval to that unique funding arrangement, which guarantees JP Morgan against losses from buying Bear. See full story. The Fed board also approved the...

Symbol Name Last Trade Change Related Info ^AORD All Ordinaries 5,131.80 10:33PM ET 156.70 (2.96%) Components, Chart, More ^SSEC Shanghai Composite 3,873.54 9:59PM ET 89.14 (2.25%) Chart, More ^HSI Hang Seng 21,109.58 10:18PM ET 1,127.53 (5.07%) Components, Chart, More ^BSESN BSE 30 15,760.52 Mar 14 0.00 (0.00%) Chart, More ^JKSE Jakarta Composite 2,263.51 10:32PM ET 119.91 (5.03%) Components, Chart, More ^KLSE KLSE Composite 1,194.84 Mar 14 6.51 (0.54%) Components, Chart, More ^N225 Nikkei 225 11,726.99 10:00PM ET 514.61 (4.20%) Chart, More ^NZ50 NZSE 50 3,430.24 10:13PM ET 70.67 (2.02%) Components, Chart, More ^STI Straits Times 2,753.13 10:33PM ET 85.88...

As feared, foreign bond holders have begun to exercise a collective vote of no confidence in the devaluation policies of the US government. The Federal Reserve faces a potential veto of its rescue measures. Asian, Mid East and European investors stood aside at last week's auction of 10-year US Treasury notes. "It was a disaster," said Ray Attrill from 4castweb. "We may be close to the point where the uglier consequences of benign neglect towards the currency are revealed." The share of foreign buyers ("indirect bidders") plummeted to 5.8pc, from an average 25pc over the last eight weeks. On the...

U.S. Treasury Secretary Henry Paulson did the rounds of America's Sunday morning TV shows to talk up the U.S. economy, promote confidence that financial markets would get through their present troubles and reassure a skeptical American public that the Bush administration was on top of the situation. Speaking on ABC's "This Week," "Fox News Sunday" and "Late Edition" on CNN, Paulson defended the Federal Reserve's decision Friday to come to the rescue of Bear Stearns (nyse: BSC - news - people ), the Wall Street investment bank most hurt by losses on trading in mortgage-related securities (See " Bear On...

Sat March 15, 2008 Farmers in fear By Jim Stafford Business Writer Prices paid to Oklahoma wheat farmers for their grain have surged to historic highs, but the prospect of $12-a-bushel wheat at harvest has yielded a surprising side effect, said farm economist Kim Anderson: Fear. The July wheat contract on the Kansas City Board of Trade closed at $12.21 Friday, down 44 cents from the previous day, but still hovering near historic levels. So, what is to fear from wheat priced at three to four times what it was just five years ago? "They are scared to death because...

If things continue this way, St. Pats day will be remembered as the crash day. Hope for better but with the Asian markets down 2-5%, it is hard to imagine a good day tomorrow.