The Fed audit - $16 trillion in secret loans

[Jhhnn]

Deny what? I'd like nothing better than for every politician to be machine gunned into a pink mist - on second thought, that's perhaps getting off too easy. Let me sum up your posts so you don't need to waste your time here anymore:

Republicans/Conservatives bad RAWR!!!!!1111!!!, Democrats <slurp slurp slurp>....

Okey dokey, no need for more Jhhn posts, got that covered.

Chuck

Still no content- zero, zip, nothing, nada.

In case you haven't noticed, mindless derision isn't content, just denial.

 

[Jhhnn]

So you are ignorant. Too blinded by partisan politics to see that both sides are guilty of financial rape. Your ideology allows for this to happen once again because you believe (incorrectly) that if the left was the only party none of this would have happened. You delude yourself with such pie in the sky notions and thus become that which you loath (ideologically induced willful blindness).

And we return to yet another rhetorical tool of willful blindness & denial- false attribution coupled with false equivalency w/o anything in support other than hot air.

"They're Just As Bad!"

I've linked some of the actual deeds of Repubs during the period in question that enabled the Boom & bust of the housing bubble. You've offered nothing of the sort.

 

[NoStateofMind]

And we return to yet another rhetorical tool of willful blindness & denial- false attribution coupled with false equivalency w/o anything in support other than hot air.

"They're Just As Bad!"

I've linked some of the actual deeds of Repubs during the period in question that enabled the Boom & bust of the housing bubble. You've offered nothing of the sort.

Jesus Christ dude I feel sorry for you. You seriously are blind. Enjoy your willful delusion I suppose.

 

[Dr. Zaus]

And we return to yet another rhetorical tool of willful blindness & denial- false attribution coupled with false equivalency w/o anything in support other than hot air.

"They're Just As Bad!"

I've linked some of the actual deeds of Repubs during the period in question that enabled the Boom & bust of the housing bubble. You've offered nothing of the sort.

http://en.wikipedia.org/wiki/Barney_Frank#Fannie_Mae_and_Freddie_Mac

better?

 

[Macamus Prime]

It's OK - this is what most of you wanted; taking care of the rich.

It all works out. So,... how much of that 16 trillion trickled down to your pockets?

 

[ayabe]

As I said, these were short-term, interest bearing loans, often REPO loans that were collateralized. They were fully repaid from all evidence reported. Dozens of banks took advantage and rolled maturities or used it repeatedly within days/weeks/months of the last use, which is why the number is huge, the same loans were created many times during the worst periods.

Bernie is frothing at the mouth in faux righteous indignation to drum up support and zealousness in the proletariat. It's nothing more than political theatre.

Negative, some of this money was free profit handed to well-connected people.

"It's hard to imagine a pair of people you would less want to hand a giant welfare check to &#8212; yet that's exactly what the Fed did. Just two months before the Macks bought their fancy carriage house in Manhattan, Christy and her pal Susan launched their investment initiative called Waterfall TALF. Neither seems to have any experience whatsoever in finance, beyond Susan's penchant for dabbling in thoroughbred racehorses. But with an upfront investment of $15 million, they quickly received $220 million in cash from the Fed, most of which they used to purchase student loans and commercial mortgages. The loans were set up so that Christy and Susan would keep 100 percent of any gains on the deals, while the Fed and the Treasury (read: the taxpayer) would eat 90 percent of the losses. Given out as part of a bailout program ostensibly designed to help ordinary people by kick-starting consumer lending, the deals were a classic heads-I-win, tails-you-lose investment."

http://www.rollingstone.com/politic...hos-cashing-in-on-the-bailout-20110411?page=2

Taibbi uncovered this crap months ago.

Edit - more to be seen.

"But even without more information about the loans they got from the Fed, we know that TALF wasn't the only risk-free money being handed over to Wall Street. During the financial crisis, the Fed routinely made billions of dollars in "emergency" loans to big banks at near-zero interest. Many of the banks then turned around and used the money to buy Treasury bonds at higher interest rates &#8212; essentially loaning the money back to the government at an inflated rate. "People talk about how these were loans that were paid back," says a congressional aide who has studied the transactions. "But when the state is lending money at zero percent and the banks are turning around and lending that money back to the state at three percent, how is that different from just handing rich people money?"

 

[matt0611]

Don't worry. Its all for your own good. Our overlords only have your best interests in mind. Nothing to see here. Please move on.

 

[Jhhnn]

Jesus Christ dude I feel sorry for you. You seriously are blind. Enjoy your willful delusion I suppose.

Double down on a busted hand.

It's remarkable how the most fervent supporters of deregulated capitalist banking are also the first to scream the loudest about the necessary corollaries, bailouts.

In the context of what came before, the actions of first world govts & central banks, the US among them, was absolutely necessary. We'll be paying off the debt created in the runup to the crash for a very long time, too. The financial elite owns that debt. The price of the bailout is nothing compared to that.

As it is, we're running on a broken model, the same model that crashed in 2008, that's failing to fuel employment & honest recovery today. The reasons for the boom and the persistence of the bust originate from the same defective thinking in support of extreme power, wealth & privilege.

 

[LegendKiller]

Negative, some of this money was free profit handed to well-connected people.

"It's hard to imagine a pair of people you would less want to hand a giant welfare check to — yet that's exactly what the Fed did. Just two months before the Macks bought their fancy carriage house in Manhattan, Christy and her pal Susan launched their investment initiative called Waterfall TALF. Neither seems to have any experience whatsoever in finance, beyond Susan's penchant for dabbling in thoroughbred racehorses. But with an upfront investment of $15 million, they quickly received $220 million in cash from the Fed, most of which they used to purchase student loans and commercial mortgages. The loans were set up so that Christy and Susan would keep 100 percent of any gains on the deals, while the Fed and the Treasury (read: the taxpayer) would eat 90 percent of the losses. Given out as part of a bailout program ostensibly designed to help ordinary people by kick-starting consumer lending, the deals were a classic heads-I-win, tails-you-lose investment."

http://www.rollingstone.com/politic...hos-cashing-in-on-the-bailout-20110411?page=2

Taibbi uncovered this crap months ago.

Edit - more to be seen.

And I covered this months ago. Taibbi is full of faux outrage.

http://forums.anandtech.com/showpost.php?p=31551169&postcount=106

"But even without more information about the loans they got from the Fed, we know that TALF wasn't the only risk-free money being handed over to Wall Street. During the financial crisis, the Fed routinely made billions of dollars in "emergency" loans to big banks at near-zero interest. Many of the banks then turned around and used the money to buy Treasury bonds at higher interest rates — essentially loaning the money back to the government at an inflated rate. "People talk about how these were loans that were paid back," says a congressional aide who has studied the transactions. "But when the state is lending money at zero percent and the banks are turning around and lending that money back to the state at three percent, how is that different from just handing rich people money?"

Which banks are these? The Primary Dealers which *HAVE* to buy treasuries if the auction doesn't clear? Or what if the "buying" came from another area of the bank? Money is fungible.

 

[ayabe]

And I covered this months ago. Taibbi is full of faux outrage.

http://forums.anandtech.com/showpost.php?p=31551169&postcount=106



Which banks are these? The Primary Dealers which *HAVE* to buy treasuries if the auction doesn't clear? Or what if the "buying" came from another area of the bank? Money is fungible.

So ultimately your response to these charges is...meh? business as usual? I appreciate your attempt to explain this to those of us who don't work in finance. But there are two glaring issues that neither of your responses have addressed, IMHO.

1. No one on this board could have gotten a deal like this.

2. These people did profit off of this essentially "free" money.

Going any further than that really isn't necessary, that's what the outrage is all about.

 

[chucky2]

Jhhnn234

Right

 

[Jhhnn]

Chucky2 adds nothing 3 times in a row, other than empty derision, but apparently feels compelled to do so...

It's a way to call out to other denialists for support & solidarity...

And a way to avoid considering facts outside of one's own ill-formed opinion.

The mind of a progressive? Nah- the mindlessness of a conservative, of the emotional need to believe in lies of convenience. So smug. So self righteous. So impenetrable to reason as to be vacuum packed & hermetically sealed in self satisfied denial. Not to mention proud, very proud indeed to be that way.

 

[Modelworks]

That book has already been debunked many times. As with most conspiracy theory books, it takes kernels of truth and warps them. The original idea behind the Fed wasn't even what was proposed to Congress and what was adopted by Congress wasn't even what was proposed. What was adopted was then changed several times.

Toss out the conspiracy stuff and just look at the facts, The Fed is the most corrupt government associated area of the government.

 

[soccerballtux]

this is inflated #, Fed only makes overnight loans to banks with sound financials, 30 nights of $10B loans is counted as $300B worth of loans, this number means very little and is nothing out of the ordinary for the Fed-- one reason they exist is for the what they're doing here.

This is not something worth getting worked up about guys, I promise you. Got plans tonight but I can post more later. There are far bigger things to be tracking down if one is on the hunt for corruption & injustice.

 

[werepossum]

Chucky2 adds nothing 3 times in a row, other than empty derision, but apparently feels compelled to do so...

It's a way to call out to other denialists for support & solidarity...

And a way to avoid considering facts outside of one's own ill-formed opinion.

The mind of a progressive? Nah- the mindlessness of a conservative, of the emotional need to believe in lies of convenience. So smug. So self righteous. So impenetrable to reason as to be vacuum packed & hermetically sealed in self satisfied denial. Not to mention proud, very proud indeed to be that way.

A black hole of irony has just formed, and its density threatens all life as we know it.

Be afraid. Be very afraid.

 

[LegendKiller]

Toss out the conspiracy stuff and just look at the facts, The Fed is the most corrupt government associated area of the government.

You haven't a single shred of evidence to back that up. Please post *exact* points for each one of your supposed corruptions with evidence. From what I read, that guy can't do it nor can/will you.

 

[LegendKiller]

So ultimately your response to these charges is...meh? business as usual? I appreciate your attempt to explain this to those of us who don't work in finance. But there are two glaring issues that neither of your responses have addressed, IMHO.

1. No one on this board could have gotten a deal like this.

2. These people did profit off of this essentially "free" money.

Going any further than that really isn't necessary, that's what the outrage is all about.

If you had the ability to purchase TALF eligible debt, which means you had to be a QIB or other Investment Act eligible purchasers AND you had a sufficient amount of capital to purchase the assets, anybody on this board could have purchased the assets. There are plenty of companies that bought TALF eligible debt and financed it through the Fed, far more just paid cash.

As far as the "Free" money, the government was effectively taking super-senior AAA risk in asset classes that were very well known and weren't prone to the downturn.

It is a *FACT* that many companies which financed their debt with TALF eligible assets were able to finance their securitizations far more effectively post-TALF than pre-TALF. Those companies range from Avis-Budget to Ford. TALF is widely credited with saving the securitiation market and, without it, several companies would likely have had major problems for no reason at all. For example, Avis-Budget's own stock price dropped to .34, all because their bonds were about to mature and many doubted they could refinance the vehicle fleet while the credit markets were frozen.

Just how many people would have been out of a job if CAR had fallen? Who would have been able to step in? Certainly not Hertz, Enterprise or DTAG - all were having the same issue. This despite all of them having good business models.


It's easy to get pissy and thrash your arms and legs in fury without actually researching the issue.

 

[Jhhnn]

A black hole of irony has just formed, and its density threatens all life as we know it.

Be afraid. Be very afraid.

Hey, Chucky2's call for support worked! Another post containing nothing but derision!

I'd ask that you back it up it with some sort of facts, figures or other support, but you obviously can't... there's been ample opportunity.

Confronted with the truth, Righties just dig in their heels, and deny, deny, deny, hurling insults as a means of making the truth just go away...

 

[Arglebargle]

Without getting into the specifics: If you let bankers rule, you get a world good for bankers.

 

[a777pilot]

I want to know if this country is making interest money off of these loans. We sure could use it.

 

[chucky2]

Hey, Chucky2's call for support worked! Another post containing nothing but derision!

I'd ask that you back it up it with some sort of facts, figures or other support, but you obviously can't... there's been ample opportunity.

Confronted with the truth, Righties just dig in their heels, and deny, deny, deny, hurling insults as a means of making the truth just go away...

Keeps getting better and better.... :thumbsup:

 

[Demo24]

I want to know if this country is making interest money off of these loans. We sure could use it.

Of course. "The Fed's payments to the Treasury made up 3.5 percent of all federal revenue in 2010 — nearly $76 billion"

http://factcheck.org/2011/07/fiscal-factcheck/


I didn't bother to read the whole thread in depth. Seems like people made a knee-jerk reaction over 16 trillion, without realizing that money isn't just 'lost'.

 

[blackangst1]

Im not sure why the word secret is being used. Its pretty common knowledge the fed sent money overseas with bailout money, its just the extent was unknown.

 

[jman19]

Keeps getting better and better.... :thumbsup:

Not that I necessarily agree with Jhhnn or LK, but you aren't offering anything other than inane bullshit in this thread.

 

[BoomerD]

Of all the things in which a company can invest, government is the most profitable.

We have the best government that money can...and does...buy.

A GOOD politician is one who stays bought.