Last Sunday, August 19, the Fed granted to Bank of America, the right to borrow $25 billion directly from the Fed to provide liquidity to its affiliates. I am reading these stories in WSJ and Bloomberg. They disclosed the exemption in a regulatory filing this week. On Monday, August 20th, the Fed extended the same exemption to Citibank "to extend credit to market participants in need of short-term liquidity to finance their holdings of certain mortgage loans.'' B of A spokesman Robert Stickler said, "We're not sure what's going to happen down the road, so we want to get ready for contingencies.'' Holy toledo...all this talk of stealth fed moves may not even be hitting the mark, it may even be more stealthy than originally thought!
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