Merry Xmas Wall St. from Barack

[cybercoma]

http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

This is just stunning. $7.77 trillion!? This money was handed out by the Fed. Reserve at 0.01% and is being loaned back to the US government at 3%.

How much more obvious can it possibly get that the entire system is a fraud designed to concentrate wealth into the hands of very few people.

[bush_cheney2004]

...How much more obvious can it possibly get that the entire system is a fraud designed to concentrate wealth into the hands of very few people.

It's not very obvious at all, since governments use such "fraud" to redistribute wealth all the time. The US Fed is poised to be the world's banker yet again, rescuing the EU from the abyss (third time in the past 100 years).

[kimmy]

http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html

This is just stunning. $7.77 trillion!? This money was handed out by the Fed. Reserve at 0.01% and is being loaned back to the US government at 3%.

How much more obvious can it possibly get that the entire system is a fraud designed to concentrate wealth into the hands of very few people.

I would point out that his is not all at Obama's feet, as some of this money was already being handed out while the Bushies were still in power.

Regardless, this is why I think the Occupy movement was warranted.

-k

[cybercoma]

A bit of sensationalism in the title, kimmy. I'm guilty.

[cybercoma]

It's not very obvious at all, since governments use such "fraud" to redistribute wealth all the time. The US Fed is poised to be the world's banker yet again, rescuing the EU from the abyss (third time in the past 100 years).

Neat. I didn't realize the EU was around 100 years ago. Thanks for teaching me something new today.

[dre]

This money was handed out by the Fed. Reserve at 0.01% and is being loaned back to the US government at 3%.

Yeah Iv been trying to explain this little scam to people for months, but people dont seem to want to wrap their minds around it. How private banks collect trillions of dollars in interest for lending governments money that the government just created. Its the biggest scam ever run in human history.

It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.

Henry Ford

Edited December 2, 2011 by dre

[cybercoma]

I'm on board with you dre. What's shocking is that $7.7 TRILLION has now been lent out and hidden from Congress. That's half the GDP of the United States. This is beyond insane. The United States government is nothing more than a cabal that has worked for generations to undermine foreign sovereignty (word to McCarthy), develop a global market for their transnational corporations and now is unabashedly working on concentrating all the wealth in the world in the hands of the top 1% (actually, 0.1%). Over 300 economists have hopped on board condemning what's going on. Hell, even Sir Richard Branson said tonight on Colbert that OWS "has a point." It's a brilliant scheme, but they're now getting careless about it.

Edited December 2, 2011 by cybercoma

[maple_leafs182]

It's not very obvious at all

It really is.

[dre]

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

Heres some more fun stuff...

One story that didn’t seem to make any of the mainstream news is the results of the recent audit of the Federal Reserve. This is a huge story and it has been either buried or ignored, depending on how you perceive it. As it turns out, the Federal Reserve lent out over $16 trillion during the financial crisis in 2008 and then refused to provide any information to the public

16 trillion dollars... Its official! Bailing out the failing global fiat empire is the most expensive project in human history.

The Fed provided conflict of interest waivers for employees and contractors, so they could keep their investments in banks and corporations that were given emergency loans.

The CEO of JP Morgan Chase served on the New York Fed’s board of directors at the same time that his bank received more than $390 billion in financial assistance from the Fed.

William Dudley, who is now the New York Fed president, was granted a waiver to let him keep investments in AIG and General Electric at the same time AIG and GE were given bailout funds.

The Fed outsourced virtually all of the operations of their emergency lending programs to private contractors like JP Morgan Chase, Morgan Stanley, and Wells Fargo. The same firms also received trillions of dollars in Fed loans at near-zero interest rates.

Two-thirds of the contracts that the Fed awarded to manage its emergency lending programs were no-bid contracts.

Who controls the central bank? The people who own large stakes in the corporations that the central banking gave trillions of dollars to.

Who controls the governments financial apparatus? Wallstreet.

Who was in charge of doling out billions of dollars to GoldMan Sachs? Neel Kashkari... Vice President of Goldman Sachs

Im in the WRONG LINE OF WORK!!!

Fed Secretly Lends 16 Trillion Dollars

One story that didn’t seem to make any of the mainstream news is the results of the recent audit of the Federal Reserve. This is a huge story and it has been either buried or ignored, depending on how you perceive it. As it turns out, the Federal Reserve lent out over $16 trillion during the financial crisis in 2008 and then refused to provide any information to the public.

Know how much 16 trillion dollars is?

A stack of 16,000,000,000,000 (sixteen trillion) one dollar bills would be 1,085,856 miles high.

Over a million miles. Im pretty sure that if you actually printed it out on paper that would be enough money to paper mache the planet, and you could just whip up a few trillion more dollars to buy the paste.

That stack of bills would reach the moon... then back to earth... then to the moon again... and back to earth again... And there would still be a 100,000 mile high stack of dollars to buy beer after the trip.

I think people are pretty much numb to all this now. They are making so much money that people literally cannot comprehend the numbers involved. Thank god they invented electronic money, or the Fed would have harvested most of the worlds forests by now. .

With the stroke of a pen, the federal reserve, which is a privately run consortium of 12 different gigantic private corporations has just extracted thousands of dollars worth of real wealth and purchasing power from each and every person that has any dollars and taxed the wages of every single worker in the economy. They had to do this because they loaned out so much money at interest between 1996 and 2006 that they created a massive asset bubble.

Edited December 2, 2011 by dre

[cybercoma]

Yeah, but dre... it's not obvious.

[bush_cheney2004]

Yeah, but dre... it's not obvious.

Definition of OBVIOUS

1: archaic : being in the way or in front

2: easily discovered, seen, or understood

Used in the present policy context, it's not "obvious" at all. People on an internet forum regurgitating what they read on other web sites does not increase the "obvious".

If it takes American dollars (yet again) to set Europe right, then it shall be....obviously.

Edited December 2, 2011 by bush_cheney2004

[maple_leafs182]

Definition of OBVIOUS

1: archaic : being in the way or in front

2: easily discovered, seen, or understood

Used in the present policy context, it's not "obvious" at all. People on an internet forum regurgitating what they read on other web sites does not increase the "obvious".

If it takes American dollars (yet again) to set Europe right, then it shall be....obviously.

Okay, I get what your saying. But do you at least understand that the Fed is a corrupt institution, that it benefits the banks over the people.

[sharkman]

Bush spent too much and that was a knock I had against him. Obama is simply crazy with the money and the question is what will this debt do to the American economy?

When Obama had the cash for clunkers program, you could easily see what effect this had on the economy in that sector. It was a textbook case. The car industry perked right up while the money was flowing, then went off a cliff when it ended. I really hope the same won't happen with the American economy because plenty of people who called the 2008 drop are calling for another one.

[sharkman]

Okay, I get what your saying. But do you at least understand that the Fed is a corrupt institution, that it benefits the banks over the people.

The problem is, if the banks fail then the economy will collapse. This will see people losing their jobs, their homes, starving to death, and dying for lack of simple medical care. It would be as the Depression was. The people don't know it but if the banks fail the whole system fails.

The corruption institution line doesn't begin to describe it. But the people are corrupt too. That's why our institutions are corrupt, they are run by people who make corrupt decisions.

[cybercoma]

The problem is, if the banks fail then the economy will collapse. This will see people losing their jobs, their homes, starving to death, and dying for lack of simple medical care.

That's happening now. Well, except for the Wall St. investors that just got a boost on their investments this week, thanks to this.

[maple_leafs182]

The problem is, if the banks fail then the economy will collapse. This will see people losing their jobs, their homes, starving to death, and dying for lack of simple medical care. It would be as the Depression was. The people don't know it but if the banks fail the whole system fails.

The corruption institution line doesn't begin to describe it. But the people are corrupt too. That's why our institutions are corrupt, they are run by people who make corrupt decisions.

I know that if the banks fail the system fails, that is what I want to happen, well I wouldn't say I want that to happen because lots of people will suffer but that is what needs to happen.

[bush_cheney2004]

I know that if the banks fail the system fails, that is what I want to happen, well I wouldn't say I want that to happen because lots of people will suffer but that is what needs to happen.

But what is the hurry? If the "system" is going to fail eventually (your belief), letting it do so without an abrupt collapse is better. Forcing it to happen just to satisfy some spiteful need isn't the "system" at all.

[sharkman]

I know that if the banks fail the system fails, that is what I want to happen, well I wouldn't say I want that to happen because lots of people will suffer but that is what needs to happen.

If you knew of all the ways a collapse would hit you where you live, you wouldn't think it is what needs to happen.

[cybercoma]

That's a good argument for the nationalization of the banking industry then. I don't think it's in anyone's interest (except the bankers) to allow them to run a business that will immediately be bailed out with taxpayers' money when they fail. There is no incentive for them to do well. In fact, it's more incentive to do poorly, so they can cash in on the fact that we can't let them fail. Since the ramifications of poor business decisions affect everone and it's in no one's interest to let the banking industry fail, it should be nationalized. Otherwise, we're simply socializing the losses and privatizing the gains.

[blueblood]

That's a good argument for the nationalization of the banking industry then. I don't think it's in anyone's interest (except the bankers) to allow them to run a business that will immediately be bailed out with taxpayers' money when they fail. There is no incentive for them to do well. In fact, it's more incentive to do poorly, so they can cash in on the fact that we can't let them fail. Since the ramifications of poor business decisions affect everone and it's in no one's interest to let the banking industry fail, it should be nationalized. Otherwise, we're simply socializing the losses and privatizing the gains.

Nationalizing the banking industry is e stupidest idea I've ever heard. There would be an even larger moral hazard and losses than we have now. That's how you devalue the currency and put the brakes on growth. They should have been allowed to fail and the Canadian banks would have picked up the assets for pennies on the dollar.

[dre]

Nationalizing the banking industry is e stupidest idea I've ever heard. There would be an even larger moral hazard and losses than we have now. That's how you devalue the currency and put the brakes on growth. They should have been allowed to fail and the Canadian banks would have picked up the assets for pennies on the dollar.

No need to nationalize banking, just the central bank. Canada nationalized ours in 40's and every single share is held in trust by the Minister of finance. The result: Canadas banks behaved a lot better.

Private banks are fine, as they act like banks (accept deposits and loan them out at interest). Thats not at ALL what banks today do though.

Goverments should nationalise MONEY CREATION not traditional branch banking.

Edited December 3, 2011 by dre

[maple_leafs182]

But what is the hurry? If the "system" is going to fail eventually (your belief), letting it do so without an abrupt collapse is better. Forcing it to happen just to satisfy some spiteful need isn't the "system" at all.

If we let the system collapse in '08 we would probably be back to growth already. Instead we are prolonging the agony and now there is a risk of currencies collapsing which will do even more damage then had we just let everything collapse in '08.

If you knew of all the ways a collapse would hit you where you live, you wouldn't think it is what needs to happen.

Yes I would. It does need to happen, all this bad debt needs to be liquidated.

[August1991]

This is just stunning. $7.77 trillion!? This money was handed out by the Fed. Reserve at 0.01% and is being loaned back to the US government at 3%.

It's not $7.77 trillion. It's $13 billion.

Incidentally, you, dre and the article do not mention that the Fed now pays a remarkable 0.25% on deposits with the Fed. (Before 2008, the Fed paid nothing.) IOW, commercial banks had to deposit money with the Fed - and received no compensation whatsoever.

If we let the system collapse in '08 we would probably be back to growth already.

In the 1930s, the US unemployment rate rose to almost 30%. It took about 10 years to get back to the same GDP as in the 1920s. Is that what you would want?

I would point out that his is not all at Obama's feet, as some of this money was already being handed out while the Bushies were still in power.

Regardless, this is why I think the Occupy movement was warranted.

WTF?

The US Fed is a lender of last resort in the same way that my local fire department is a first responder. Would it be better to let houses burn to the ground (as a lesson to people who play with matches)? Maybe. But in Montreal, where houses are close to one another, the lesson may cause many others to lose their house too.

----

It is called "macro" economics for a reason. The ideas and principles that may apply to your "micro" household/family do not necessarily apply for the economy as a whole.

[cybercoma]

August, you might want to read the whole article:

the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.

[August1991]

Cybercoma, when the article in the OP says that the Fed "committed" $7.7 trillion, it means that the Fed deposited money in the banks' accounts with the Fed. Based on this, it is calculated that the banks made $13 billion between the interest rate charged for this loan and what the banks were able to make lending the money out.

Well, a heck of alot of people did the same. As a friend in Spain recently said to me, "With the Fed lending money at such rates, you would be crazy not to borrow." How many Canadians have decided not to pay their variable rate mortage back quickly?

It's called an extremely expansionary monetary policy. (The modern term is quantitative easing.)

----

Other notes:

No need to nationalize banking, just the central bank. Canada nationalized ours in 40's and every single share is held in trust by the Minister of finance. The result: Canadas banks behaved a lot better.

The supposed "ownership" of the Bank of Canada or the US Fed is irrelevant. I have no easy explanation for Canadian banking stability (compared to the US) except history.

English-Canadian nationalists always want to show how Canada is different from the US. Well, money is the best example and yet no Canadian nationalist has ever drawn this obvious example.

Americans have always had a funny relationship with money whereas we Canadians, at least historically, have been pragmatic. Americans would never tolerate the kind of concentrated banking power that we in Canada take as normal.

The governor of the Bank of Canada can deal with Canada's banking sector by inviting five men to lunch in his dining room on Wellington. (Of course, they would speak English.) Quantitative easing? The governor simply deposits government money in whichever bank he wants. Such cozy deals would be unthinkable in the US (as the OP makes obvious).

Here's something (non-PC) to ponder. The two most recent US Fed Chairmen were Jewish. To my knowledge, all of Canada's BoC governors were male WASPs. Canada has never had a francophone (French speaking person) or a Catholic (let alone a Jew) as governor of the Bank of Canada. French-Canadian nationalists are quick to find fault elsewhere but few note this seeming bias.

Mark Carney baragouine le français. Il n'est pas francophone.

In short, I reckon that nationalists (typically leftists) are bad at math. They don't understand money.

Edited December 4, 2011 by August1991