Investors worried by extent of US Fed action
Interventions by the US Federal Reserve intended to boost the economy are being increasingly seen by investors as signs of desperation and only serving to spread panic. After offering troubled investment bank Bear Stearns loans of up to $30 billion last week, the Fed has announced that it will allow securities firms to borrow from the central bank under conditions normally only available to regulated banks. After trading at $US57 a share only days ago the news that Bear Stearns will be sold to JPMorgan Chase for $2 a share created more negative sentiment, sending markets around the globe falling. The US dollar fell to its lowest point against the Japanese yen in 12 years yesterday and to a record low against the Euro.
Source: The Australian