Bank of Japan Boosts Funds in System to Ease Credit

[Sapiens]

http://www.bloomberg.com/apps/news?p...oHg&refer=home
Bank of Japan Boosts Funds in System to Ease Credit

Aug. 10 (Bloomberg) -- The Bank of Japan added 1 trillion yen ($8.49 billion) to the financial system, joining central banks in the U.S. and Europe in supplying cash to assuage a credit crunch.

The cash injection was the largest same-day operation since June 29, according to Bloomberg data. The European Central Bank yesterday loaned 94.8 billion euros ($130 billion) in response to a sudden demand for cash from banks. The U.S. Federal Reserve added $24 billion in temporary reserves to the banking system yesterday, the most since April.

Wow, can you say bank run?!

[Sapiens]

Countrywide Says `Unprecedented' Disruptions May Hurt Profit

http://www.bloomberg.com/apps/news?p...iaw&refer=home

Countrywide Says `Unprecedented' Disruptions May Hurt Profit

Aug. 9 (Bloomberg) -- Countrywide Financial Corp., the biggest U.S. mortgage lender, said ``unprecedented disruptions'' in the U.S. home-loan market may crimp its ability to lend and erode profit.

The company may be forced to retain more of the loans it makes to homeowners rather than selling them to investors, Calabasas, California-based Countrywide said today in a filing with the U.S. Securities and Exchange Commission. It also said it may have difficulty obtaining financing from its creditors.

``The secondary market and funding liquidity situation is rapidly evolving, and the potential impact on the company is unknown,'' Countrywide said. ``These conditions may continue or worsen in the future.''

Now, who in his right mind is willing to buy loans for properties that are about to be re-priced and burn precious cash?

[metalman]

Re: Countrywide Says `Unprecedented' Disruptions May Hurt Profit

http://www.bloomberg.com/apps/news?p...iaw&refer=home



Now, who in his right mind is willing to buy loans for properties that are about to be re-priced and burn precious cash?

yeh, I'd wait. this is gonna get really, really innerestin'

[c1ue]

Re: Bank of Japan Boosts Funds in System to Ease Credit

Although the timing is too short, hence suspect, this sure does look like a classic cash crunch.

The question is whether the second part of the Great Depression behavior will now come: i.e. even with free money, no one will take or extend loans.

Clearly this has happened with the LBO and mortgage markets, but is it really happening with the rest?