22 replies to this topic

[vic]

http://www.unelected...tzcpoB.facebook

Audit of the Federal Reserve Reveals $16 Trillion in Secret Bailouts
Posted by ⒶD on July 21st, 2011

The first ever GAO(Government Accountability Office) audit of the Federal Reserve was carried out in the past few months due to the Ron Paul, Alan Grayson Amendment to the Dodd-Frank bill, which passed last year. Jim DeMint, a Republican Senator, and Bernie Sanders, an independent Senator, led the charge for a Federal Reserve audit in the Senate, but watered down the original language of the house bill(HR1207), so that a complete audit would not be carried out. Ben Bernanke(pictured to the left), Alan Greenspan, and various other bankers vehemently opposed the audit and lied to Congress about the effects an audit would have on markets. Nevertheless, the results of the first audit in the Federal Reserve

[vic]

if your money is in ANY of these banks, and you don't take it out and let them know why, you are part of the problem.

[TakeAStepBack]

Vic, we are being broken on purpose.

That said, those are major corp. banks that have ties with many smaller banks. One would basically need to join a credit Union if available to dodge NOT having money into one of these entities.

[TakeAStepBack]

Consolidation is the goal. We are close to world government and currecny. it's only a matter of time now...within our lifetime type time. Buckle up.

[Joker]

Part of me hopes to be around in 20 years just to see how all this is turning out, part of me thinks I'll be better off dead by then

[TakeAStepBack]

and at a 16 trillion dollar bailout, not only do all of us have money in those banks like it or not, our grandchildrens children will be paying it off (money invested) too.

[vic]

Vic, we are being broken on purpose.

That said, those are major corp. banks that have ties with many smaller banks. One would basically need to join a credit Union if available to dodge NOT having money into one of these entities.

then follow the trail of your 'smaller' bank to see which of these larger entities control them. what would be wrong with joining a credit union? toddy drives this point home and is absolutely correct...the only way to beat these bastards is by using your dollars against them

[TakeAStepBack]

Nothing is wrong with it. It just happens to usually be exclusive to locals. There is no credit union in NYC for instance I have been able to locate.

I could choose the smaller bank of queens, but it is under affiliaiton with BoA.

[Julius]

I'll get back to you with an economics lesson after the market closes, but the article is absurdly false beyond any reason.

[TakeAStepBack]

Please do. The .gov pdf provided, along with Senator Sander's will likely disagree with your pointing at "absurdly false".

[Julius]

I read the referenced pdf file and it accurately shows loans, yes, loans made to financial institutions through a number of emergency programs designed to prevent runs on banks. A bank is only required to hold 10% of its deposits as liquid cash, the rest gets loaned out, so if there is a run on a bank, it fails because it can't cover withdrawals. Therefore the fed provides liquidity in a program called the "Discount Window" or in this case a variation of it called the Primary Dealer Credit Facility.

Here is wiki link that is factual, and states that all loans through this program were paid back, with interest. http://en.wikipedia....Credit_Facility

The data is accurate in the article, but only if you take each overnight loan and add them all together. . . irrelevant math, that was the same money being lent out again and again.

And yes it was done in secret. If it had been public, a major panic would have ensued.

[TakeAStepBack]

I'll get back to you with an economics lesson after the market closes, but the article is absurdly false beyond any reason.

I read the referenced pdf file and it accurately shows loans, yes, loans made to financial institutions through a number of emergency programs designed to prevent runs on banks. A bank is only required to hold 10% of its deposits as liquid cash, the rest gets loaned out, so if there is a run on a bank, it fails because it can't cover withdrawals. Therefore the fed provides liquidity in a program called the "Discount Window" or in this case a variation of it called the Primary Dealer Credit Facility.

Here is wiki link that is factual, and states that all loans through this program were paid back, with interest. http://en.wikipedia....Credit_Facility

The data is accurate in the article, but only if you take each overnight loan and add them all together. . . irrelevant math, that was the same money being lent out again and again.

And yes it was done in secret. If it had been public, a major panic would have ensued.

So........how is the article absurdly false.
I'd have to dig to find the loans repaid......

[Julius]

So........how is the article absurdly false.
I'd have to dig to find the loans repaid......

Well for a start, the loans were repaid within days. Those were overnight loans.

"virtually none of the money has been returned and it was loaned out at 0% interest."
False, false, check the wiki reference and I can provide a dozen more.

"Why the Federal Reserve had never been public about this or even informed the United States Congress about the $16 trillion dollar bailout is obvious

[TakeAStepBack]

[quote name='Julius']Well for a start, the loans were repaid within days. Those were overnight loans.

"virtually none of the money has been returned and it was loaned out at 0% interest."
False, false, check the wiki reference and I can provide a dozen more.

[B]"Why the Federal Reserve had never been public about this or even informed the United States Congress about the $16 trillion dollar bailout is obvious

[seany]

I'm trying to figure out why there should be outrage here?

If these were "overnight" loans, which happen every single day and have for decades, then why the alarmist stance? I understand that there is a lot of suspicion and even hatred of the Federal Reserve and I completely buy into the notion that there should be far more oversite and auditing of their activities. That said, the short-term (or "overnight" or "Fed Funds") rate for bank loans from the FR has been 0 - 0.25% for several years now. This isn't "new" news. Previously the interest rate on these loans might have been 0.25% to 0.75%, but it was dropped to 0% many years back (so long ago that I'm pretty sure Greenspan was still at the helm when it happened) to free up funds so as not to hinder the economy further. There's the "Fed Funds Rate" and then the "Fed Discount Rate" and then the "Prime Rate" - all of which are somewhat intertwined and used to set other lending rates. I'm not an economics or banking person, but this is pretty basic stuff.
It's not like that $16 trillion wasn't paid back. If that were seriously the case, then - YES - there should be major outrage. If these are the typical overnight loans, then this article is just alarmist hype.

[Julius]

Which part is false?
The part where the FR lent out more than our current debt sealing secretly?
You're comparing a liquidity number to a national debt number? That's like saying it's wrong for two turkeys to weigh more than an ostrich. Unrelated!

--You must have missed the math. The facility was for overnight loans. They get that number by taking the loan and multiplying those same $$$$ by each night it was borrowed. Sort of like Ernie and Bert: one for you, one-two for me.


That it would have outraged the public?
Or that the entire banking system would have collapsed? Which is speculative at best and also alarmist.
--Not sure where you were when Lehman collapsed but everything was going down without help.

So if there was a profit, where did that go? Who benefited?
--The US Treasury, and therefore the taxpayer

It's a major pet peeve of mine that these crisis loans made out of necessity and paid back in full are still referred to as "bailouts."

Admittedly the whole situation was terribly hard to understand for anyone without an economics degree, so people are vulnerable to all this "spin."

[Julius]

Thank you seany. Note that TARP was loaned out at 8% when you include the warrants the gov't got!

[Julius]

And fed doesn't and shouldn't give a flying fuck about whether the public is outraged. Not their mandate.

[TakeAStepBack]

It's our money to pay back. They most certainly should "give a fuck." The government isnt a business for profit.

EDIT: I see them now. The answers

Which part is false?
The part where the FR lent out more than our current debt sealing secretly?
You're comparing a liquidity number to a national debt number? That's like saying it's wrong for two turkeys to weigh more than an ostrich. Unrelated!

SO is the debt ceiling an issue right now?

--You must have missed the math. The facility was for overnight loans. They get that number by taking the loan and multiplying those same $$$$ by each night it was borrowed. Sort of like Ernie and Bert: one for you, one-two for me.

I'll have to dig out whether the loans were repaid and who actually benefited from the loans.

That it would have outraged the public?
Or that the entire banking system would have collapsed? Which is speculative at best and also alarmist.
--Not sure where you were when Lehman collapsed but everything was going down without help.That's speculative! Everything DID go down the drain...so?

So if there was a profit, where did that go? Who benefited?
--The US Treasury, and therefore the taxpayer.....riiiiggghhht. Checking into it.

[Julius]

I highly encourage you to do your own research. That was a fascinating time for the world economy and there's a lot to be learned from it.

But in 2008 I was a financial analyst trading bank stocks, options, and the occasional credit default swap. If I didn't know my shit on this stuff, I'd be pretty broke now. I think you can take me at my word on these basics.

[TakeAStepBack]

I certainly will do my own search.

[Tim the Beek]

Insofar as I have hate in me, I have it for the Fed, and for our fiat banking system. But i do think the article is misleading for reasons folks have mentioned above.

That doesn't make me love the Ben Bernank any more than I already do though...

[beerzrkr]

http://www.dailysqui...=article_medium