Fed Expands Muni Bailout Facility

from Zero Hedge

While municipalities around the nation are demanding more ‘free money’ helicopter drops from the government, The Fed has just stepped up its efforts to bailout America’s states and cities.

Just as The Fed tapers its buying program in US Treasuries, it appears to be dropping down the risk spectrum dramatically by offering to directly monetize primary issuance from states (and up to two cities from each state).

The Federal Reserve Board on Wednesday announced an expansion in the number and type of entities eligible to directly use its Municipal Liquidity Facility (MLF).

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