

On the Road to Reflation

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Eight of the world's major central banks sent a strong, unequivocal signal to global markets Wednesday that they will do anything and everything in their power to prevent another financial meltdown and the risk of a renewed global economic contraction.

The Federal Reserve, in conjunction with the European Central Bank, the Bank of England, the Swiss National Bank, the Bank of Japan and the Bank of Canada, slashed the cost of dollars provided through the Fed's dollar swap facilities to ease the funding crisis faced by European banks as a result of the eurozone sovereign debt crisis.