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Wall Street Whispers About the Central Bank Intervention

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Hans Neleman | Getty Images

The mysterious midweek coordinated action by the world's central banks has many on Wall Street speculating about possible causes.

"Why did they suddenly come out with this?" a trader at a large firm said over drinks in midtown yesterday.

I told him that I had no idea. So he presented his theory: a large European bank was about to fail due to its inability to borrow dollars.

Some version of this story is being told all over town. Nobody really believes that the sudden announcement of cheaper swaps for US dollars came out of nowhere.

"When you hear quacking, there's probably a duck somewhere," one investment adviser told me.

The duck, in this case, is usually assumed to be a large European financial institution. Figuring out which one has become happy hour sport for Wall Streeters.

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