Presenting The $303 Trillion In Derivatives That US Taxpayers Are Now On The Hook For

Tyler Durden's picture

Courtesy of the Cronybus(sic) last minute passage, government was provided a quid-pro-quo $1.1 trillion spending allowance with Wall Street's blessing in exchange for assuring banks that taxpayers would be on the hook for yet another bailout, as a result of the swaps push-out provision, after incorporating explicit Citigroup language that allows financial institutions to trade certain financial derivatives from subsidiaries that are insured by the Federal Deposit Insurance Corp, explicitly putting taxpayers on the hook for losses caused by these contracts. Recall:

Five years after the Wall Street coup of 2008, it appears the U.S. House of Representatives is as bought and paid for as ever. We heard about the Citigroup crafted legislation currently being pushed through Congress back in May when Mother Jones reported on it. Fortunately, they included the following image in their article:


Screen Shot 2014-12-05 at 3.32.12 PM



Unsurprisingly, the main backer of the bill is notorious Wall Street lackey Jim Himes (D-Conn.), a former Goldman Sachs employee who has discovered lobbyist payoffs can be just as lucrative as a career in financial services. 

We say explicitly, of course, because taxpayers have always been on the hook implicitly for the next Wall Street meltdown.


Exhibit A: US banks are the proud owners of $303 trillion in derivatives (and spare us the whole "but.. but... net exposure" cluelessness - read here why that is absolutely irrelevant when even one counterpaty fails):


Exhibit B: Here are the four banks that are in complete control of the US "republic."

At least we now know with certainty that to a clear majority in Congress - one consisting of republicans and democrats - the future viability of Wall Street is far more important than the well-being of their constituents. Which also, implicitly, was made clear when Hank Paulson was waving a three-page "blank check" term sheet, and when Congress voted through the biggest bailout of banks in US history back in 2008.

The only question is when the next multi-trillion (or perhaps quadrillion now that all global central banks are all in?) bailout takes place.

Source: OCC

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1000yrdstare's picture

Nothing changes until we roll the "National razor"

economics9698's picture

When I teach it just amazes me how effective propaganda is on students.  People really do not want the truth.

Cognitive Dissonance's picture

It is even more effective with 'students' who have already lived much of their life propagandized and have been working for 10 - 20 - 30 years or more.

"We the People" are a thoroughly propagandized population. And it shows.

_disengage_'s picture

What is the difference between banks propagandizing to support their interests versus the endless stream of bloggers that sell their opinions in the exact same way?

They are both doing what they "believe" in. To "enlighten the people" or to implement a global government. (both for profit of course)

economics9698's picture

The difference is the banks have a printing press and can buy anything they want, for the cost of some ink and computers.

_disengage_'s picture

Yes, but they both believe it. "Doing God's work" and all. They are both shuffling bits and expecting us to feed them.

Don't think I am defending banks, I am attacking for profit bloggers.

The Wizard's picture

Comparing bloggers who make a mere pittance in profit to banksters who have unlimited means to increase their bounty is, as the old saying goes, comparing apples to oranges.

_disengage_'s picture

I think it shows the rotten foundation. People, at the highest and lowest levels in society, want to punch keys on a computer in exchange for a really nice lifestyle.

RyeWhiskey's picture

Nice trolling and breaking down the discussion cunt.

Serfs Up's picture

These bankers...they have overstayed their welcome, abused our good cheer, and will have to be literally destroyed once again.

You'd think the tribe would figure out the pattern by now?

/My time.  It is coming.

BurningFuld's picture

Hey America. Too bad none of your politicians took math in school.

economics9698's picture

In America it is more important to teach our kids diversity than math.In America it is more important to teach our ids diversity than math.

Jeff the Terrible's picture
Jeff the Terrible (not verified) economics9698 Dec 12, 2014 9:37 AM

They broke it we bought it

jbvtme's picture

when the dust settles, the only chumps who will be on the hook will be the bankers. i'm long meat cleavers

halfasleep's picture

It's been a while since we've had a nice big bank failure and US-subsidized ingestion/annexation by the house of morgan. My bet's on Citi, by 2016.

Never One Roach's picture

The next Banker Bailout will be Bigger, Better Robustier and also drive gold up to near $5,000/oz I suspect.

SoilMyselfRotten's picture

Thank you sir, may i have another?

BuddyEffed's picture

This makes it look like the derivatives implosion is getting green light signals and a complimentary CYA.

SeattleBruce's picture

"The only question is when the next multi-trillion (or perhaps quadrillion now that all global central banks are all in?) bailout takes place."

But, but, but - it's for the children...

MalteseFalcon's picture

$303 trillion?

You ignorant bitches want a check or cash?

Pickleton's picture

Unfortunately, yea, yea WE are.  And OUR children and OUR grandchildren.  Generations of OUR posterity are going to pay for this in profound ways.  The first being the death of the Republic and the second, the slavery that will follow.

GetZeeGold's picture



it's for the children...



Yeah between Common Core and Michelle's school grandkids are pissed as hell.

new game's picture

making a list, checking it twice, gonna payback the naughty and call myself nice.

Balanced Integer's picture

I must've missed the fuckin' plane, Jeff, because I don't know WTF a video about Vegan Fags and the Faggy Vegan Shit that they eat has to do with a damn thing?



Vampyroteuthis infernalis's picture

In the end, does it matter? When the financial weapons of mass destruction blow there is going to be no way to fund the gubbimint. This will just hasten the process.

SumTing Wong's picture

I'm wondering...who was long oil contracts or some derivative on oil? And is this why we had to make sure this was in the "budget" that got passed last night?

halfasleep's picture

I read that the big six tptf banks were in some $3.9trillion thru 2016.

Oracle of Kypseli's picture

Then, if the senate passes it and O'Bummer signs it, oil is going to reverse its direction?

DeadFred's picture

Don't forget the junk bonds that are starting their swirl around the toilet.

razorthin's picture

Math and a little too much creativity are a dangerous mix.

Hail Spode's picture

"Serfs Up" Love your handle/avatar

shovelhead's picture


That only works if the proposition presented makes a minimum of sense to anyone, even those on the lowest left side of the bell curve.

This doesn't.


Escrava Isaura's picture





You wrote: What is the difference between banks propagandizing to support their interests versus the endless stream of bloggers that sell their opinions in the exact same way?


The difference in a nutshell:

Blog is a symptom, and bank is the cause of the symptom.


Blog won’t cure private-banking (bank-money) symptom; and stop its Central Banks rescuing those banks.

However, bloggers will develop the platform and language to explain that since the 70’s, US turned from an Empire of production (engine of the middleclass) to an Empire of consumption (financialization and lots of debt) that led us to an Empire of elusion (our education and massmedia systems).


Anyway, let’s just hope that we bloggers, do not becoming as corrupted and delusional while doing it.


“The intellect has a sharp eye for methods and tools, but is blind to ends and values. So it is no wonder that this fatal blindness is handed on from old to young and today involves a whole generation.” The Goal of Human Existence Albert Einstein (1943)



MEFOBILLS's picture

The founding fathers wanted the Senate to be the “greatest deliberative body on earth.”  In that body would be law, and deeper still would be moral law. 

Since money is a division of the law, then the banker machinations of 1912 are key to understanding today’s dysfunction.

The 16’th is income taxation, which allows Government to tax to then backstop credit making banks when their system goes unstable (it is inherently unstable).  Remember TARP?

17’th amendment is the most pernicious.  It allows Senators to be elected by popular vote.  The founders intended on Senators to be sent by their state legislators.  Senators were to represent their State Legislators and hence to empower States in a Federal Structure.  A Senator can be recalled in this sytem if they do not do the poltical bidding of their masters in the States.  Senators relationship to Gov’t is the first paragraph in the Constitution.  Senators today are populists funded by Credit making banks and tied corporations.  Lobbyists direct their funding toward Senators to the buy the public’s vote - this one act converted our country from a politically driven republic to a hidden money power democracy.  (Democracy is one of the worst forms of government.)  Senators represent their power base, which is corporations, especially banking corporations.

Federal Reserve Act, the IRS, and debt hooks of WW1 and WW2 soon followed, and hence formed all the necessary machinery.  Fed is a debt money system of private banks, who then host government via the acts of 1912. 

Ends and Values can be easily ascertained by a group of advanced Senators who are deeply steeped in law and history.  Witness the Magna Carta and Constitution which have at their base, Civilizational Ends and Values.


Einstein existed in a period where Private Creditors, of his tribe, had mounted a takeover of legal society.

Sandmann's picture

Since the F-F were Republicans rather than Populists they clearly wanted the Senate immune from direct election and representing State Governments as in modern Germany.......a revising chamber giving a real Confederation aspect.

The way the Federal Government slipped free of constraints is similar to the way Adolf Hitler overthrew the individual German states with Gleichschaltung

Sandmann's picture

More Privy Council than House of Lords

Escrava Isaura's picture




Let’s focus in three things that you wrote, please:


First: “the Senate to be the “greatest deliberative body on earth…. The moral law. The founders intended Senators were to represent their State and hence to empower States in a Federal Structure.


Second: A Senator can be recalled in this system if they do not do the political bidding of their masters in the States. 


Third: “Lobbyists direct their funding toward Senators to the buy vote - converted our country from a republic to a hidden money power democracy.




I find the property of your analyze terrible, because you failed to try to correct the issue of power and cronyism. You just moved it back to the states.


But, for the sake that you might be right; then, how would you address the majority of states that gain more from federal expenditures than they pay into the federal government? Would the senator from another state cut it out to bring to his or her state?


On the third issue; would you have each state issue their own currency? Who would mint it?



On your first point, here’s one of the “Founding Lawyers”:

James Madison made the following comment about the Senate:

In England, at this day, if elections were open to all classes of people, the property of landed proprietors would be insecure. An agrarian law would soon take place. If these observations be just, our government ought to secure the permanent interests of the country against innovation. Landholders ought to have a share in the government (senate), to support these invaluable interests, and to balance and check the other. They ought to be so constituted as to protect the minority of the opulent against the majority. The senate, therefore, ought to be this body; and to answer these purposes, the people ought to have permanency and stability.


highly debtful's picture

I don't think Disengage is trolling. Even if I do not agree with him on all his points, he started a discussion that might be worth some reflexion.

Look, if we're going to accuse of trolling every man or woman that doesn't see things the way of the majority of this ZH-community, then we're killing all critical thinking and are officially putting an end to our own learning curve. Not me, thank you.

Element's picture

Spot on +

The ending of descent is the beginning of CONsensus.

To buggery with anyone who tries to impose it.

mkkby's picture

 Bull fucking shit.  All he's doing is stating everyone talks their book.  Everyone know that, therefore it's trolling to argue that in favor of a bankster mafia that has bribed it's way into controlling everything worth controlling. 

They've destroyed democracy, the rule of law and the value of money worldwide, but to this faggotty asshole a blogger stating his opinion is just the same.


Element's picture

True mkkby, but you're mistakenly equating a statement of a general principle (which is what I stated), implies support for some specific instance, which you've somehow construed to be support for that person's assertion. Which is most definitely not the case. The general principle bears stating because there's far too much of it going on. Anyone who disagrees with a comment simply screams 'troll', or dysinfo agent, or state security mole - all immature laughable and 99.9% baseless obfuscation of the responsibility for a two sided discussion to consider the points and arguable veracity of other points being made.

Point v Counterpoint

When one side of the Point v Counterpoint process says, "Sorry we don't want to hear any counterpoints any more", they're in entirely the wrong place. This should be a basic convention required, by and of all commenters.

Mrs. Cog's picture

I completely agree that slapping labels on people because we disagree is very limiting. Considering every point of view is essential to learning.

Disengaged regularly launches into vicious attacks specifically aimed at Cog, always vitriolic and deliberately misrepresenting Cog's clearly stated purposes. When conversations are derailed with mudslinging and off topic distractions rather than a back and forth exchange of ideas and points, it is trolling. Whether that originates by being a paid shill or a complex over one's short penis, it is still trolling.

Please see numbers 5 and 7

sleigher's picture

Awesome, so now whenever someone challenges me on a topic I can just reply "what is that, rule number 8?"  That seems to cover a few of them anyways... :)

Element's picture

Hi, not in favor of that approach (which I know GW and Cogs are) simply because I've seen people abuse that sort of list specifically to obfuscate valid points being made by others. i.e. dishonest people use them too.

Besides that doesn't it seem a bit 'off' to you to use it? Yes, it's educational to some extent to peruse, and yes it's a convenience for people who write deliberately contrary blog posts and attract serial misrepresentations. But when a person is determined to be intellectually dishonest and misrepresent statements and positions or to extend and read into in unwarrented ways to twist and deliberately misconstrue, pointing this out to the person doing it tends to yeild highly ineffective results. Especially on the internet.

Honest people don't need the list to discuss things, and dishonest or agenda-driven zealots don't care and will often react in even more dishonest ways.

Tall Tom's picture

Unfortunately _disengaged_ has suceeded because most of the conversation has been devoted to his tactics rather than the POINT that...




Personally I do not care about _disengaged_. HE IS IRRELEVANT.




As for _disengaged_...


He can take his posts and give himself a rectal enema with them.


Ms Cog...There is no disrespect intended. And thanks for that link. Just stop it.

indygo55's picture

One big difference is that the people at the top can print money out of thin air and commit fraud without fear of jail while everyone else cannot. That's the big difference. If the fraud was legal across the board and everyone copuld print money out of thin air, I don't think you would want that. Then you couldn't be in control. Right?