Today the US government added yet another weapon in their crash fighting arsenal: outright stock purchases. The US Treasury is prepared to deploy some 250 billion dollars to buy direct stakes in US financial firms. The results were predictable: with shorts running for the hills and investors seduced by avarice buying on the open, short term money dumped shares bought during yesterday's long orgy.
The government has remained ready and willing to do anything to prop up financial markets. They have temporarily guaranteed bank loans in response to similar actions in europe. With Treasury long bond prices still above par, the government still possesses an infinite supply of monetary bullets to fire at the evolving bear market.
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