A coordinated action by the world's top central banks in easing dollar swaps will prevent the siezing up of short term credit in the event that things get worse in Europe.

Reuters:

The U.S. Federal Reserve, the European Central Bank and the central banks of Canada, Britain, Japan and Switzerland said in a joint statement they had agreed to lower the cost of existing dollar swap lines by 50 basis points from December 5.

Other measures included setting up bilateral swap arrangements between the central banks so that any bank could tap additional liquidity in their own currencies if necessary. The swap arrangements are good through Feb 1, 2013.

In the United States, the Fed noted that banks were not having difficulty now getting funds in short-term finding markets. But if conditions deteriorate, the U.S. central bank said it has "a range of tools available" to use as a backstop and would deploy them as necessary.

The surprise coordinated move by central banks was aimed at preventing global financial markets from coming under pressure that could potentially lead to a seizing up of credit.

"The purpose of these actions is to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity," the banks said in typically stilted language.

It doesn't effect what's going on in the negotiations over the fate of the euro zone directly, but it does offer hope for investors that the flow of credit will remain open in the event of a real meltdown.

Note this: "...the U.S. central bank said it has "a range of tools available" to use as a backstop..." in the event that the worst case scenarios come to pass. This may be another clue that the US Federal Reserve will step in to the crisis if all else fails and it appears that the euro zone will go down for the count. This, despite the White House statement on Monday that denied there were any plans to directly intervene in the crisis.

Europe is considered by the Fed to be "too big to fail."