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Republicans Demand Block Of US IMF Funding To Bail Out Europe
In an odd coincidence, we were just updating the notional amount of FX swaps that the Fed has conducted with Europe in the past week, when we noticed that the GOP has finally made it an issue to fill in the gray area void of whether or not the US will be required to fund the IMF bailout of Europe. Tangentially, the Fed's USD swaps - an indicator of dollar-denominated last resort liquidity - just hit a 2012 high of $84.5 billion, increasing by $2 billion from the $82.5 billion in the prior week which makes us scratch our heads just how is it that Europe is "getting better" if instead of declining, usage of USD swaps is increasing confirming interbank liquidity is non-existence. This merely confirms that 4 weeks after peaking at a multi-year high of $85.4 billion in the last week of December, the European liquidity situation has once again started to deteriorate. It also means that the "self-reported" to the BBA 3M USD (but it's 'declining') is and continues to be about as worthless as any data out of the NAR. Finally, it disproves that statement under oath that Bernanke made to Congress that he would not bail out Europe. However, while Bernanke does not have any direct checks and balances-type supervision (the private Fed is merely beholden to its bank supervisors - just note the Class A directors on the FRBNY's Board) and does not have to concern himself too much with the nuances of perjury, the same can not be said about the US Secretary of the Treasury, for at most another 11 months, Tim Geithner, who doesn't have very powerful interests watching over him. It is Tim Geithner who would ultimately be the person responsible for permitting any IMF (of which America is the largest quota member, and thus, funder) capital transferm in which US taxpayer capital is used to rescue the lost cause known as Europe.
Which is why we were delighted that after months of modest confusion on the topic, the Congressional Committee on Financial Services (including subcommittee chairman Ron Paul), have demanded that not only Geithner make his stance on a US-funded IMF bailout of Europe crystal clear, but that they are openly opposed to "American taxpayer dollars being used to bail out Europe...through additional contributions to the IMF." We are curious to see just how Geithner will weasel his way out of responding to this: perhaps the only logical stall tactic is to reply that he will be busy helping Mitt Romney in his tax "revisions" over the next several months.
Incidentally, the House Committee on Financial Services may want to also ask the Fed Chairman how he reconciles his "no European bailout" statement with the chart below:
The press release issued by the "Republican Leaders." We are confused why Democrat Leaders are also not interest in the SecTres' response on the question of whether and how much US citizens will be bailing out the Italians and French with.
Washington, Jan 25 - Republican leaders of the House Financial Services Committee are seeking assurances from the Obama Administration that U.S. taxpayers will not bear the burden of bailing out debt-ridden European governments.
In a letter sent Wednesday to Treasury Secretary Timothy Geithner, Chairman Spencer Bachus, Vice Chairman Jeb Hensarling and the chairmen of the Committee’s six subcommittees ask for confirmation that the Administration will not use taxpayer funds to subsidize Europe’s financial programs through additional contributions to the International Monetary Fund (IMF).
The IMF has requested up to $500 billion to respond to the Eurozone debt crisis. The U.S. is the IMF’s largest member country.
“The European Union includes four of the ten wealthiest countries in the
world. European countries have the ability to implement austerity measures to reduce their countries’ debt over the long term and they also have the means to restore confidence to markets,” Chairman Bachus and the other Committee Republicans said.
In addition to Chairman Bachus and Vice Chairman Hensarling, the letter was signed by:
Rep. Scott Garrett, Chairman of the Subcommittee on Capital Markets and Government Sponsored Enterprises
Rep. Ron Paul, Chairman of the Subcommittee on Domestic Monetary Policy and Technology
Rep. Shelley Moore Capito, Chairman of the Subcommittee on Financial Institutions and Consumer Credit
Rep. Judy Biggert, Chairman of the Subcommittee on Insurance, Housing and Community Opportunity
Rep. Gary Miller, Chairman of the Subcommittee on International Monetary Policy and Trade
Rep. Randy Neugebauer, Chairman of the Subcommittee on Oversight and Investigations
And the full letter to Geithner:
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http://www.infowars.com/bombshell-fema-camps-confirmed-nightly-news/
Once the money leaves the treasury to the IMF is out of Congress's control. Either we don't fund the IMF or we shut the fuck up. I am sure the U.S. tax payers have already funded the IMF's bail out fund. Its likely a done deal. This is a political strategy to blame the other party...I am sure the republicans already know the money was sent...
Yen up Asian stocks down.
ASX200 got smashed.
Yea, but first he needs to get the Bamster to contribute more of his income to charity. And I don't mean to the good Rev. Wright:)
7 Dec - A date which will live in infamy
If the the Congressional Committee on Financial Services don't want Americans to be a part of the IMF 'solution' for Europe, isn't the real question then, "what is the point of the IMF?". I don't believe for a minute that throwing good money after bad is the solution for Europe, but if Americans are only interested in contributing funds to the IMF for the use of those funds in America; what's the point of having the IMF in the first place? It seems that the IMF is a great idea (although undoubtable not to ZHers) until it comes to ponying up for a joint effort (eg creating 'stability') in a country that is not ones own...
ever hear of pouring money down a rabbit hole Easter Bunny?
The IMF has been subverted. Nowhere does it propose the remedies it imposed on Korea in 1998 - a country with a high savings ratio - nor the one imposed on Argentina. It is an extension of the French Finance Ministry and is run by a Lawyer who worked for William Cohen as a bag carrier and for Baker & MacKenzie. This is a joke. The IMF let global debt get out of control and failed to castigate the US treasury for NOt cracking down on Wall Street because it is too cosy in DC
FED already wired 70dill currency swaps to ECT. ]
Since 2008 FED has proposed UNLIMITED FUNDING with Fees( not interest) to CB's = SAFE !!
CB's lend the money with interest and pay back the FED.
http://money.cnn.com/2008/10/13/news/economy/central_banks_dollar_funds/index.htm
Banksters have their way.
Like "today" IMF strives for funds, why?? to lend it to the same club back to back.
ts ts ts ts
PP
When we have our own problems, should we be bailing out Greece, Spain, Portugal and Italy?
Spain's unemployment rate just hit 22.9%. And Ollie "The Folly" Rehn proclaimed that a Greek debt deal will be done in the next three days.
Spanish Unemployment Rises to 22.9%, Greece “Close” to Deal
http://confoundedinterest.wordpress.com/2012/01/27/spanish-unemployment-rises-to-22-9-greece-close-to-deal/
Fed Swap Activity increased with Europe but Japan repaid a small portion to show an overall net decline for the week.
http://displacedema.blogspot.com/2012/01/fed-swap-line-activity-decreased.html
The IMF isn't bailing out Europe with US taxpayer dollars. It is bailing out Global Banks with US taxpayer + European taxpayer Dollars and upping the ante. Globalised Finance has finally outgrown any one Continent and has Liabilities (noone but a fool could consider them Assets) larger than the global economy. Short of Martians bringing supplies of Platinum and Gold but not enough to destabilise the price ! The game can go on. This Pyramid Scheme has run out of Collateral and Gamblers need to be kicked out of the Casino so the rest of us can get back to rebuilding a REAL economy where Needs and Wants are met by proper Industry.
We have been taken hostage by the Banks and are playing their game of ever-increasing Leverage. It has to stop. It might need armed uprisings to remove the String Puppets currently running the show, but there is no way to keep these saucers circulating in the air. They are wasting our time and it may be the end of current generations and their ability to live and save and raise families without fear of abject poverty. Someone has to pull the plug onb the Debt Creation Machine and start to shoot the Gangsters.
Maybe these Banks should give up their EQuity and the Personal Property of the Officers as Collateral for aid - same for the Political Elites
Hey Tyler,
why is it that hardly anyone has any clue that the US taxpayer already bailed out Europe to the tune of a half a trillion dollars once in this depression?
For the 50th time:
UBS, Switzerland’s largest bank, was the biggest borrower from the Commercial Paper Funding Facility, tapping the program 11 times for $74.5 billion.
Six European banks were among the top 11 companies that saccumulated the most debt overall -- a combined $274.1 billion .
Dexia tapped the US government for $53.5 billion. Other European users included Barclays Plc in London at $38.8 billion; Royal Bank of Scotland Group Plc at $38.5 billion; and Paris-based Natixis at $27 billion.
The Fed listed borrowing for Paris-based BNP Paribas at $41.8 billion.
Commerzbank of Germany borrowed $350 million at the Fed’s discount window.