US secret Europe bailout over Christmas week

It's nearly impossible to find specifics on this story, but last week, while American's were enjoying the Christmas holidays, our government decided it would be a perfect time to bailout Europe in the form of a currency swap. Yup, we exchanged our Dollars for the Euro. I can't source an exact figure, but rumors are it was around $50 Billion. The Fed chose to do a currency swap as opposed to a 'bailout', so the American people wouldn't become upset. Even though it will devalue our currency as much as a bailout would. The Fed paid for this by printing a lot more money over Christmas.


(Wall Street Journal)
"The Fed is using what is termed a "temporary U.S. dollar liquidity swap arrangement" with the European Central Bank (ECB). Simply put, the Fed trades or "swaps" dollars for euros. The Fed is compensated by payment of an interest rate (currently 50 basis points, or one-half of 1%) above the overnight index swap rate. The ECB, which guarantees to return the dollars at an exchange rate fixed at the time the original swap is made, then lends the dollars to European banks of its choosing.

Why are the Fed and the ECB doing this? The Fed could, after all, lend directly to U.S. branches of foreign banks. It did a great deal of lending to foreign banks under various special credit facilities in the aftermath of Lehman's collapse in the fall of 2008. Or, the ECB could lend euros to banks and they could purchase dollars in foreign-exchange markets. The world is, after all, awash in dollars."