Alan Grayson on the Fed Bailout

A good read,— but not in a good way.

If you’re sick of the ‘bad’, you should stop here.

But if you want to see where your money went,…. at the same time they’re telling you that you need to sacrifice more,…. then read on.

The Fed Bailouts: Money for Nothing

A few paragraphs:

Feel free to take a look at it yourself, it’s right here. It documents Wall Street bailouts by the Fed that dwarf the $700 billion TARP, and everything else you’ve heard about.

I wouldn’t want anyone to think that I’m dramatizing or amplifying what this GAO report says, so I’m just going to list some of my favorite parts, by page number.

Page 131 – The total lending for the Fed’s “broad-based emergency programs” was $16,115,000,000,000. That’s right, more than $16 trillion. The four largest recipients, Citigroup, Morgan Stanley, Merrill Lynch and Bank of America, received more than a trillion dollars each. The 5th largest recipient was Barclays PLC. The 8th was the Royal Bank of Scotland Group, PLC. The 9th was Deutsche Bank AG. The 10th was UBS AG. These four institutions each got between a quarter of a trillion and a trillion dollars. None of them is an American bank.

Pages 133 & 137 – Some of these “broad-based emergency program” loans were long-term, and some were short-term. But the “term-adjusted borrowing” was equivalent to a total of $1,139,000,000,000 more than one year. That’s more than $1 trillion out the door. Lending for these programs in fact peaked at more than $1 trillion.

Pages 135 & 196 – Sixty percent of the $738 billion “Commercial Paper Funding Facility” went to the subsidiaries of foreign banks. 36% of the $71 billion Term Asset-Backed Securities Loan Facility also went to subsidiaries of foreign banks.

 

Quote of the Day

It’s really amazing what passes for media/press coverage in our world today. No wonder that people stay confused.

This is a prime example from an article in the Times. (Ooops,.. I see you’ll have to log in for the Times article. I think you can still get the gist of it from the 2 paragraphs.)

With my pick for the quote of the day in bold, at the bottom.

From Brad DeLong

It Still Amazes Me That People Actually Get Paid for Writing Things Like This…

AP:

US Debt – Money Managers’ Least Favorite Investment: Ask the people who invest billions for a living to name their favorite picks for 2012 and you’ll get a smorgasbord worthy of a holiday party: Brazilian stocks, U.S. junk bonds, and government debt from Colombia. Ask them what they dislike and they’ll name one of the top-performing investments this year: U.S. government bonds. Investors can rattle off a long list of reasons to avoid Treasurys. They pay next to nothing and are bound to plunge in value whenever interest rates begin climbing from their historically low levels. It seems nobody likes Treasurys, yet everybody keeps buying them anyway.

“Our least favorite asset is Treasurys,” said Christine Hurtsellers, chief investment officer for fixed-income at ING Investment Management during a recent press briefing. “We still have a lot, but it’s hard to make the argument for them.” It’s a tricky problem for bond-fund managers at a time when everyday Americans are trusting them with more of their savings…

Duncan Black observes:

Eschaton: Everybody Hates US Treasuries, Too Many People Are Buying Them; This article is the bond market version of “nobody goes there anymore, it’s too crowded.

Why oh why can’t we have a better press corps?

 

Dick(s) of the Week

The Toph man asked me if I could do (what is likely to be the 1st of a few, there seems to be an abundance of ), Dick(s) of the Week today. It seems he’s gotten himself involved with this thing called a job,— which periodically takes up quite a bit of his free time, apparently. Sounds like a nasty business to me, I’m glad I’m not involved.

Luckily, I didn’t have to look much further than this article that comes from  Richard RJ Eskow’s blog. It actually provides several D of the W’s all in one fell swoop.

The Greatest Hoax in the History of Money: The Fed, The Banks, The Lies

Just a couple of examples……..

>It took the journalists at Bloomberg News two years – and presumably lots of legal fees – to pry information out of the Federal Reserve that should have been made public long ago. We now know that the Fed’s secret $7.7 trillion lending program wasn’t just the most massive bank bailout ever seen, and it wasn’t just free money for mega-bankers – though it was certainly both of those things. It was also the greatest hoax in stock market history.<

Robert Rubin made an estimated $155 million during his tenure at Citigroup.

One in four mortgages in this country is still underwater.

Brian Moynihan at Bank of America got promoted, then made that ‘homework’ wisecrack.

Twenty-four million Americans are un- or under-employed, including record numbers of young people and African-Americans.

The CEO of Goldman Sachs , Lloyd Blankfein, still has his job.

Poverty has soared to record levels since the financial crisis.

Erin Burnett, who made fun of a young demonstrator for not being aware of the misinformation she had repeated, still has an evening news program on CNN. She is engaged to be married to a Citigroup executive.

College graduates’ unemployment rate rose last month, while the total amount of student loan debt in the United States is now greater than the total amount of credit card debt.

Jamie Dimon made a second career out of complaining that bankers are being unfairly criticized, even as Chase became the largest bank in the United States – and the world.

Jefferson County, Alabama, where Chase was forced to settle charges of bribing local officials, recently declared bankruptcy.