Probably then the ECB will step in with its long-awaited couple of hundred billion - which is already out there in the marketplace and just needs to be unleashed as long term rather than short term lending.
One Fed official thinks the first boost in the short-term lending rate won't occur until 2016.
Credit-market indicators that reflect jitters about short-term lending to banks have been creeping higher for several days.
In addition, regulators have unveiled all sorts of programs to backstop the short-term lending markets, money market funds, bank deposits and bank debt.
To some extent, reserves held by banks at the Fed will contract automatically, as improving financial conditions lead to reduced use of our short-term lending facilities, and ultimately to their wind down.
The Treasury report says that short-term lending is easing up and they're happy about that, but companies are still finding it hard to get money longer term at rates that they're happy with.
For instance, the sooner the Basle capital-adequacy rules are revised, so that they reflect more accurately the risks of short-term lending in emerging markets, the quicker banks will have the correct incentives for prudent lending.
All these crises are alike in that the bankers play the yield curve and push money out to doubtful borrowers in order to get maximum advantage of the spread between the cost of borrowing short term and lending long term.
The flood of short-term lending, which was denominated in dollars, had the effect of lowering interbank lending rates for two-week euro loans to 4.45% from 4.95% an indication that financial institutions were willing to provide funds to eachother and, by extension, to borrowers at large.
In Australia, the government has shared refinancing risk on projects to allow short-term bank lending in the construction phase.
The move is designed to cut down on short-term dollar lending in Brazil.
Presumably, countries that attract more foreign direct investment suffer less than those that have a greater amount of footloose portfolio investment or short-term bank lending.
U.S. lending practices, spurred by short-term gain, had banks lending to sub-prime borrowers with no money down.
As a result, one source of profit, taking short-term deposits and lending the money for longer at higher rates, has dried up.
Because the core business of banking is taking in money at short-term interest rates and lending it back out at long-term interest rates.
Sceptics note that a large chunk of the increase is accounted for by short-term bills rather than new lending to finance spending.
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Dexia, which used short-term funding to finance long-term lending, found credit drying up as the euro zone debt crisis worsened.
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On the consumer banking side, a more normal yield curve would benefit banks like Morgan Stanley due to a better lending environment as banks can borrow short-term rates and lend long-term.
During the financial crisis, banks stopped lending to each other, resulting in their short-term supplies of funding drying up.
They have already done the first: easing the rules on foreign lending to India, to try to attract short-term funds.
But the biggest drawback to the short-term growth forecasts is that they ignore the role that bank lending has to play in Asia's recovery.
The situation was different with short-term bonds, as central banks around the world pushed down overnight lending rates.
China's short-term prospects thus depend on how quickly the government damps down the lending frenzy.
Earlier Tuesday, investors appeared encouraged after the Federal Reserve's said it would buy massive amounts of commercial paper in order to kick-start lending in the markets where many companies turn for short-term loans.
With commercial banks gradually pulling their interbank and short-term credit lines from Soviet institutions and completely cutting off medium-term lending, the Kremlin's authorities are tempted, if not compelled, to take on higher pay-off banking transactions internationally.
These giant debts triggered the crash of 2008 because creditors refused to roll over short-term loans to banks, and caused the simultaneous recession because banks stopped lending, and have brought about our current economic malaise because our ability to spend and invest is hobbled by the imperative of repaying what we owe.
More lending to an industry that gorged on credit is only a short-term tactic at best.
Yet if the risks in the eurozone are receding, why are investors still parking most of their money in "safe haven" German bonds -- and even paying Berlin for the privilege of lending it money as the negative yields at recent auctions of short-term German bonds illustrate?
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