By the time the "too big to fail" banks and their lobbyists get through with the rules, banks will be relatively free to pursue lending practices that existed before the crash.
The Fed Does It Again: $80 Billion Secretive "Bank Subsidy" Program Uncovered, Providing Bank Loans At 0.01% InterestSubmitted by Tyler Durden on 05/26/2011 07:11 -0500
The Fed does it again. Following consistent allegations that the Federal Reserve operates in an opaque world, whose each and every action has only had a purpose of serving its Wall Street masters, led to repeated lawsuits which went so far as to get the Chairsatan to promise he would be more transparent, Bloomberg's Bob Ivry breaks news that between March and December 2008 the Fed operated a previously undisclosed lending program, whose terms were nothing short of a subsidy to banks. Says Ivry: "The $80 billion initiative, called single-tranche open- market
operations, or ST OMO, made 28-day loans from March through December
2008, a period in which confidence in global credit markets collapsed
after the Sept. 15 bankruptcy of Lehman Brothers Holdings Inc. Units of 20 banks were required to bid at auctions for the cash. They
paid interest rates as low as 0.01 percent that December, when the Fed’s
main lending facility charged 0.5 percent." 0.01% interest is also known by one other name: "outright subsidy." It doesn't get any freer than that: 0.01% interest on one month cash. Just how close to a complete implosion was the financial system if 0.5% interest seemed too high? Not surprisingly, this program was widely used: "Credit Suisse Group AG, Goldman Sachs Group Inc. and Royal Bank of Scotland Group Plc each borrowed at least $30 billion in 2008 from a Federal Reserve emergency lending program whose details weren’t revealed to shareholders, members of Congress or the public...Goldman Sachs, led by Chief Executive Officer Lloyd C. Blankfein,
tapped the program most in December 2008, when data on the New York Fed
website show the loans were least expensive. The lowest winning
bid at an ST OMO auction declined to 0.01 percent on Dec. 30, 2008, New
York Fed data show. At the time, the rate charged at the discount
window was 0.5 percent." Yes, that Goldman Sachs. The same one that perjured itself when it said before the FCIC that it only used de minimis emergency borrowings. Just how many more top secret taxpayer subsidies will emerge were being used by the Fed to keep the kleptocratic status quo in charge?
Jon Weil On How Tim Geithner's Credibility Hit The Triple Hooks (And Is Staring The Single Ds In The Face)Submitted by Tyler Durden on 04/23/2011 10:40 -0500
Jonathan Weil hits another one out of the ballpark.: "Geithner says the chance of a downgrade is zero. S&P says the odds it will cut its rating might be greater than one out of three. So who are you going to believe? Geithner? Or the people at S&P who actually will be deciding what S&P will do about S&P’s own rating of U.S. sovereign debt? It would be one thing to express the view that a downgrade would be unwarranted, or that the chance of it happening is remote. Either of these positions would be defensible. Geithner went beyond that and staked out an absolutist stance that reeks of raw arrogance: There is no risk a rating cut will occur. He left no room for a trace of a possibility, ever."
A systematic plan to create the illusion of stability and provide no-risk profits to the mega-Wall Street banks was implemented in early 2009 and continues today. The plan was developed by Ben Bernanke, Hank Paulson, Tim Geithner and the CEOs of the criminal Wall Street banking syndicate. The plan has been enabled by the FASB, SEC, IRS, FDIC and corrupt politicians in Washington D.C. This master plan has funneled hundreds of billions from taxpayers to the banks that created the greatest financial collapse in world history. The authorities had a choice. This country has bankruptcy laws. The criminally negligent Wall Street banks could have been liquidated in an orderly bankruptcy. Their good assets could have been sold off to banks that did not take their extreme greed based risks. Bond holders and stockholders would have been wiped out. Today, we would have a balanced banking system, with no Too Big To Fail institutions. Instead, the years of placing their cronies within governmental agencies and buying off politicians paid big dividends for Wall Street. Their return on investment has been fantastic.
Barney Frank quizzing Ben Bernanke has got to be the funniest thing one can see today. So here is your chance to laugh. While not expected to say much if anything of note, using the same testimony as yesterday, Bernanke may engage in a few Freudian slips before the Frank, who has already asked the key question - should the Fed engage in more bond buying in light of the oil price spike. Don't expect a response. From C-Span: "Today, the House
Financial Services Committee can expect to hear more of the same from
Bernanke as he appears before lawmakers for the second time this week.
They will likely question the Fed Chief on what the Central Bank is
doing to jolt the economy into increased recovery. Committee members
will also want to continue yesterday's line of questioning on how the
Fed is reacting to oil prices that have been going up up up in the wake
of unrest in the Mideast and North Africa."
A significant extension to my 3 minute Q&A on CNBC's Fast Money show yesterday that, in my opinion, provides irrefutable evidence that commercial real estate is about to enter a cyclical bear market. Then again, what do I know...
The market rallied on Friday as Hosni Mubarak abdicated his manipulatedly elected throne, walked out of the country like...
FASB Bends Over For The Final Time & Accuracy In Financial Reporting Dies An Ignominious Death, Proving Ignorance IsTruly Bliss With Other People's Money!!!Submitted by Reggie Middleton on 02/09/2011 09:13 -0500
Regulatory Capture now appears to be accepted policy procedure as FASB bends over and gives up on even asking financial entities to report accurate market values, leaving only those who spend their lives in spreadsheets and arcane nomenclature capable of discerning trash from treasure. I guess it best that way. The truth has this proclivity to hurt people's feelings, not to mention certain ill gotten gains...
The administration's support for Bernanke's "weak dollar" policy is evident in the way that Obama keeps reiterating his promise to double exports in 5 years. This simply can't be done without ripping the dollar to shreds, which appears to be Obama's intention.
The person who is almost singlehandedly responsible for the complete disaster that are today's bankrupt GSEs, somehow succeeds in making America hate him even more, when he notes that the global response of condemnation to the Fed's actions, and the subsequent enjoinder by Republicans who wish nothing less than to save the dollar, instead of allowing hyperinflation to deal with the consequences of the idiotic actions by the MA congressman, is "extreme hypocrisy." How this excuse for a representative (of anything more than a few well-rounded bankers) gets any air time is beyond us. Until then, we will make sure the collective blood pressure of our readership remains elevated thanks to such unprecedented examples of the supreme corruption in D.C. as Barney Frank. And unrelated, but even more disturbing, is Frank's statement that he doesn't mind that there haven't been prosecutions of financial crisis players. Don't worry Barney, prosecutions will come... Luckily these will happen once your immunity lapses.
I think we have created a Banksta thrashing Monsta...;-)
Possibly the most incendiary moment of yesterday's fraudclosure hearing in which Bank of America and JP Morgan representatives saw no evil and heard no evil, even as Chris Dodd wanted it over so he can buy no evil with the years of accumulated lobby booty from said banks after his long overdue reign of corruption finally ends, was when the CEO of the Neighborhood Assistance Corporation of America, Bruce Marks, realized he has had enough of the endless lies and goes postal at the appropriately named JPM henchman David Lowman, CEO of Chase Home Lending. After Lowman says that "Chase strongly prefers to work with borrowers to reach a solution that lets them keep their homes" Lowman flips out. Watch the hilarious results here. This video is merely a harbinger of what happens when pent up anger at banker lies overflows. Luckily, this time everything ended peacefully, and to the banks' credit, the voice was promptly silenced. Next time, it won't be so easy...
This comes along...
Former BIS Advisor And Central Banker Warns Entire World Is On Verge Of Another Bubble That "Could Burst With Disastrous Consequences"Submitted by Tyler Durden on 11/03/2010 12:34 -0500
In an interview with Dow Jones, William White, who previously was an economic adviser to the Bank of International Settlements, and prior to that spent 22 years at the Bank of Canada, warned that the "massive infusion of credit" accompanying the sudden and dramatic ramp up in the printing of new money as a policy response to all problems, both within the developed and developing worlds, is now "manifesting itself in the sharp rise of asset prices in large developing economies, which could potentially become another bubble that will burst with disastrous consequences for the global economy." He added that the global economy is in a 'particularly dangerous' position that can only be corrected if the currencies of developing countries strengthen relative to those of developed countries, according to William White, one of the few policy makers to correctly predict the onset of the financial crisis. Of course for that to happen, the much fabled decoupling needs to finally manifest itself, and for Jim O'Neill to be finally proven right. Of course, that won't happen. Which is why we ask, the next time there is a systemic wipe out, in addition to naturally eliminating the Fed, can the terms BRIC, N-11, and all other such ridiculous acronyms, please be banned from usage in perpetuity?