Central Banks Flood Money Markets with Cash
The credit market that upheld the U.S. economy is now dragging down investments. French bank BNP Paribas jolted U.S. markets when it suspended all activity in three investment funds, saying losses in U.S. subprime mortgages made it impossible to tell what their funds were worth.
The Federal Reserve and other central banks have flooded money markets with cash, hoping to make it easier for banks and funds to work out their problems. But it only made Wall Street more nervous, as David Wessel, deputy Washington bureau chief of The Wall Street Journal, tells Steve Inskeep.
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