The Federal Reserve is prepared to expand TALF to $1 Trillion

The Federal Reserve reported today that it is prepared to expand Term Asset-Backed Securities Loan Facility (TALF) to up to $1 trillion. Under the expansion, newly issued AAA-rated asset backed securities could qualify as eligible collateral. 

The program comes as support loans to small businesses and consumers to stimulate economic activity as the financial crises deepens. The Fed had recently released the revised terms of the TALF and announced to make $200 billion available to finance several types of assed-backed securities. 

The commencement date of the TALF operations is expected to be available by the end of this month.