Sanders Releases Explosive Bailout List

[abelenkpe]

Sanders Releases Explosive Bailout List

http://readersupportednews.org/news-section2/318-66/11895-sanders-releases-explosive-bailout-list



More than $4 trillion in near zero-interest Federal Reserve loans and other financial assistance went to the banks and businesses of at least 18 current and former Federal Reserve regional bank directors in the aftermath of the 2008 financial collapse, according to Government Accountability Office records made public for the first time today by Sen. Bernie Sanders.

On the eve of Senate testimony by JPMorgan Chase CEO Jamie Dimon, Sanders (I-Vt.) released the detailed findings on Dimon and other Fed board members whose banks and businesses benefited from Fed actions.

A Sanders provision in the Dodd-Frank Wall Street Reform Act required the Government Accountability Office to investigate potential conflicts of interest. The Oct. 19, 2011 report by the non-partisan investigative arm of Congress laid out the findings, but did not name names. Sanders today released the names.

"This report reveals the inherent conflicts of interest that exist at the Federal Reserve. At a time when small businesses could not get affordable loans to create jobs, the Fed was providing trillions in secret loans to some of the largest banks and corporations in America that were well represented on the boards of the Federal Reserve Banks. These conflicts must end," Sanders said.

The GAO study found that allowing members of the banking industry to both elect and serve on the Federal Reserve's board of directors creates "an appearance of a conflict of interest" and poses "reputational risks" to the Federal Reserve System.

(snip)


Jamie Dimon, the Chairman and CEO of JP Morgan Chase, has served on the Board of Directors at the Federal Reserve Bank of New York since 2007. During the financial crisis, the Fed provided JP Morgan Chase with $391 billion in total financial assistance. JP Morgan Chase was also used by the Fed as a clearinghouse for the Fed's emergency lending programs.

In March of 2008, the Fed provided JP Morgan Chase with $29 billion in financing to acquire Bear Stearns. During the financial crisis, the Fed provided JP Morgan Chase with an 18-month exemption from risk-based leverage and capital requirements. The Fed also agreed to take risky mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired this troubled investment bank.

Jeffrey Immelt, the CEO of General Electric, served on the New York Fed's Board of Directors from 2006-2011. General Electric received $16 billion in low-interest financing from the Federal Reserve’s Commercial Paper Funding Facility during this time period.

Stephen Friedman. In 2008, the New York Fed approved an application from Goldman Sachs to become a bank holding company giving it access to cheap Fed loans. During the same period, Friedman, who was chairman of the New York Fed at the time, sat on the Goldman Sachs board of directors and owned Goldman stock, something the Fed’s rules prohibited. He received a waiver in late 2008 that was not made public. After Friedman received the waiver, he continued to purchase stock in Goldman from November 2008 through January of 2009 unbeknownst to the Fed, according to the GAO. During the financial crisis, Goldman Sachs received $814 billion in total financial assistance from the Fed.

Sanford Weill, the former CEO of Citigroup, served on the Fed's Board of Directors in New York in 2006. During the financial crisis, Citigroup received over $2.5 trillion in total financial assistance from the Fed.

Richard Fuld, Jr, the former CEO of Lehman Brothers, served on the Fed's Board of Directors in New York from 2006 to 2008. During the financial crisis, the Fed provided $183 billion in total financial assistance to Lehman before it collapsed.

James M. Wells, the Chairman and CEO of SunTrust Banks, has served on the Board of Directors at the Federal Reserve Bank in Atlanta since 2008. During the financial crisis, SunTrust received $7.5 billion in total financial assistance from the Fed.

Richard Carrion, the head of Popular Inc. in Puerto Rico, has served on the Board of Directors of the Federal Reserve Bank of New York since 2008. Popular received $1.2 billion in total financing from the Fed's Term Auction Facility during the financial crisis.

James Smith, the Chairman and CEO of Webster Bank, served on the Federal Reserve's Board of Directors in Boston from 2008-2010. Webster Bank received $550 million in total financing from the Federal Reserve's Term Auction Facility during the financial crisis.

Ted Cecala, the former Chairman and CEO of Wilmington Trust, served on the Fed's Board of Directors in Philadelphia from 2008-2010. Wilmington Trust received $3.2 billion in total financial assistance from the Federal Reserve during the financial crisis.

Robert Jones, the President and CEO of Old National Bancorp, has served on the Fed's Board of Directors in St. Louis since 2008. Old National Bancorp received a total of $550 million in low-interest loans from the Federal Reserve's Term Auction Facility during the financial crisis.

James Rohr, the Chairman and CEO of PNC Financial Services Group, served on the Fed's Board of Directors in Cleveland from 2008-2010. PNC received $6.5 billion in low-interest loans from the Federal Reserve during the financial crisis.

George Fisk, the CEO of LegacyTexas Group, was a director at the Dallas Federal Reserve in 2009. During the financial crisis, his firm received a $5 million low-interest loan from the Federal Reserve's Term Auction Facility.

Dennis Kuester, the former CEO of Marshall & Ilsley, served as a board director on the Chicago Federal Reserve from 2007-2008. During the financial crisis, his bank received over $21 billion in low-interest loans from the Fed.

George Jones, Jr., the CEO of Texas Capital Bank, has served as a board director at the Dallas Federal Reserve since 2009. During the financial crisis, his bank received $2.3 billion in total financing from the Fed's Term Auction Facility.

Douglas Morrison, was the Chief Financial Officer at CitiBank in Sioux Falls, South Dakota, while he served as a board director at the Minneapolis Federal Reserve Bank in 2006. During the financial crisis, CitiBank in Sioux Falls, South Dakota received over $21 billion in total financing from the Federal Reserve.

L. Phillip Humann, the former CEO of SunTrust Banks, served on the Board of Directors at the Federal Reserve Bank in Atlanta from 2006-2008. During the financial crisis, SunTrust received $7.5 billion in total financial assistance from the Fed.

Henry Meyer, III, the former CEO of KeyCorp, served on the Board of Directors at the Federal Reserve Bank in Cleveland from 2006-2007. During the financial crisis, KeyBank (owned by KeyCorp) received over $40 billion in total financing from the Federal Reserve.

Ronald Logue, the former CEO of State Street Corporation, served as a board member of the Boston Federal Reserve Bank from 2006-2007. During the financial crisis, State Street Corporation received a total of $42 billion in financing from the Federal Reserve.

(more at link)

--------------------------------------------------------------------------------------------------------------------------------------
Four trillion dollars.

How many jobs created?

But we need to gut social programs, accept lower wages and benefits, trash collective bargaining, child labor laws, equal pay laws, civil rights, all work until we are 70, and let our infrastructure rot because there is no money?

[DearAbby]

1. REC REC REC....KICK KICK KICK

[TheWraith]

2. Yet again, a story created by the failure to understand that a loan is not a gift.

Nor is "$4 trillion worth of loans" the same thing as "we happened to have $4 trillion dollars sitting around." If you loan out $10 million dollars 1,000 times, that's $10 billion dollars worth of loans.

You want to know why nobody like Rachel Maddow runs with this story, only anonymous conspiracy blogs? Because people like Rachel Maddow understand both banking and math.

[coalition_unwilling]

6. Your incivility, condescension and patronizing attitude are

growing quite tiresome.

What exactly are you trying to argue, that the OP is wrong to post the story of Sanders' release or that Sanders himself is somehow the dupe of 'anonymous conspiracy blogs' (whatever that McCarthyite phrase means)?

I really don't get it and I hope you will deign to grace us with an explanation.

[whatchamacallit]

18. Amazing isn't it?

This particular censored has been spectacularly successful.

[randome]

29. How is it 'incivil' to point out that a loan is not the same as a gift?

[Autumn]

32. The little people off the streets sure can't get an interest rate like that

so yeah I would consider it a gift.

[randome]

33. There are more than 300 million people in the U.S.

If even a tenth of them were in need of money, how would the government possibly have coordinated loaning money to 30 million people? The most pragmatic method of getting more money into the economy with the hope that at least some of those 30 million would benefit is to loan the money to a few thousand banks.

A few thousand banks versus 30 million individuals. It was the fastest way to get something done.

[Autumn]

35. The banks could have been charged a higher interest rate,

maybe half of what they charged us. That bailout benefited the banks only. And if I remember correctly some of them sat on that money instead of lending it out.

[girl gone mad]

40. Yes, they sat on a lot of the money..

and one specific reason they did so is because the government also decided to give them another gift, Interest On Reserves.

So not only did we give them these sweetheart no-interest loans, we turned around and paid them not to lend.

[randome]

42. I'm sure you're right that some of them sat on the money.

In the same way that there is waste in every mass program, whether it's run by the government or not.

I would think -not know- that the low interest rate was to entice banks to get that money into the system as quickly as possible.

It likely helped ameliorate the crisis. Maybe it wasn't the best thing to do but time was short.

I couldn't care less how low the interest rate was if it helped SOME banks and therefore SOME people.

People come before returns on investment. I realize we're talking about banks but the government's responsibility should be to handle a crisis as quickly as possible, profit be damned.

[girl gone mad]

54. The government's responsibility should be to handle a crisis responsibly, not just to act quickly.

This crisis was mishandled from the beginning, probably because the banks are far too influential within our government.

Bank lending never recovered. Why would it? Our system was overloaded with debt. We had reached the saturation point. The proper way to solve a debt-deleveraging crisis in the midst of a balance sheet recession is not by encouraging the creation of more debt or promoting more speculative financial activity. The best thing to do is restore balance to the real economy by reining in the financial sector and restoring spending and investment by the public sector. Economists have understood these concepts for over 100 years. Our politicians should have talked to some good economists and ignored the bankers.

[Fantastic Anarchist]

100. What girl gone mad said! +10000

[2pooped2pop]

84. I think you need to read up on what the banks did

They purposely caused this whole motherfucking crises. They sat on the money that was suppose to be used to help out the homeowner. They paid themselves lots and lots of hush money.

They fucked us and then the people collectively were forced to give them part of our money to help them out. With that money, they fucked us again.

Fuck them all, and the politicians they rode in on as well.

[bahrbearian]

44. Small Busniess Loans

[randome]

46. Yeah, that sounds good.

I don't see how that would have helped people who were underwater on their mortgages, though.

[bahrbearian]

47. They could have been given Jobs by small business's. That is were most jobs are created.

[nashville_brook]

52. Bush Jr didn't seem to have any trouble when he handed out $400 checks.

it's called the IRS. they know how to contact us.

[sabrina 1]

55. Yes, that's what they said in Europe.

How about pouring that money into Main St? I mean it's not like it hasn't been done before, successfully.

Where are all these jobs they created? Do you have something concrete to show how this actually did what you are claiming? Jobs, where are they?

[truedelphi]

63. Yep and both Issa and Kucinich mentioned this fact repeatedly as

They undertook the hearings of the House of Representatives Oversight committee and brought both Kashkari and Paulson (and then later on, Bernanke) into focus.

Again and again that due said that all that needed to happen was to have the money be diverted to state chartered banks in every region of the country. All that had to happen was to dust off the paperwork from the Savings and Loan scandal, and distribute the money that way.

Following the late 1980's regulations that whatever was loaned out to the banks had to be lao0ned out to the good people of Main Street. instead the monies were given away to such corporations as McDonald's, and of course a very few of the very big banks.

And the Big Banks never loaned any of it out to the good people of Main Street. As a result, one of the few family owned steel mills in the country went under. Here in California, over 100,000 dairy cows were slaughtered during th4e summer of 2009, in just four Northern California counties, which means that the Big Farms owned by Large Agro Interests, and all their mistreatment of the animals will succeed, while the better farmers have perished.

[zeemike]

66. How about loaning it to cities and towns and states

To fix the roads and bridges and improve infrastructure?
Instead they loan it to big companies who right off the bat skim the cream for themselves...then loan it to smaller banks at a profit...who then are supposed to loan it to people to buy houses and cars and stuff....but they don't do that....instead they go for hi yield investments in an ever ending quest for higher profitability.
Greed seems to be the motivating factor for all the do.

[randome]

82. I think all of you raise good points.

I would think the bank loans were the politically expedient way to address the crisis. I don't know and some of us are engaging in hindsight but I would think coming up with big infrastructure projects might have been fraught with plenty of political posturing over who gets what slice of the pie.

Could the process have been handled much better? Yeah, that's nearly always the case.

[2pooped2pop]

83. get something done?

besides fucking us sideways what has been done?

Houses sit vacant all across the country rotting as the owners have been removed and the house taken over by the banks. This has only helped in keeping home values down.

They got a loan that we paid for but refused to help us out in return. THey have destroyed this nation.

To bail them out should have come with a real agreement to help homeowners. Not the piece of milktoast bullshit that we got, which helped damned few, and in some ways hurt any effort to get help. If you do not fall precisely into the Obama plan, you do not get help. It is more restrictive than if no rules were put in place to help the people. More people are denied help using the home affordable crap than would have been if they didn't have those convenient rules to use to block everyone from getting assistance.

I hope the all fucking die with a stick up their asses. (better for roasting)

[nashville_brook]

51. spot on - if someone "loans" you 10 million dollars for no interest for as long as you want it...

that's a pretty damn good gift. I'd like to have that gift.

For bankers, it's the "gift" of being able to speculate wildly with no oversite, er make a profit. So yeah, it's a gift.

[Jake2413]

61. Actually most bought US Treasury Notes

A nice secure investment with a reasonable ROR with zero risk. Nice if you can get it.

[nashville_brook]

68. precisely, thank you!

[truedelphi]

60. And then we DU'ers have to overlook the fact that the

Wraith is usually wrong as well!

[chknltl]

77. why does that name sound familiar....hmmmm

Oh yes...there was a 'the wraith' that was on my DU 1 ignore list. There were exactly 4 on my ignore list for behavior I felt was trollish back then. These 4 were pro nuke power and piled on aggressively on anyone who posted anything which painted nuke power with a negative light. These four made many enemies....not that they seemed to mind. Here on DU 3 i have yet to put anyone on ignore.... may need to do some backchecking.

[2pooped2pop]

85. It would be nice to know

if those four were one and the same. Maybe du should post all of a posters names when they reply under the guise of one of their puppets.

[chknltl]

113. Here, should you wish to investigate further:

My DU 1 ignore list was:
Pigwidgeon
Dogmudgeon
NNadir
Dead Parrot
TheWraith
Not sure I spelled them right but the four who used to pile on any anti-nuke power DUers or posts are in that list. They were rude, often times over the top rude which is how they made my ignore list. T
Here is a link to a DU poll regarding nuclear energy, in it you will see some of the names from my ignore list....I did not reread it but I suspect if you do read the contents you may see the very characteristics I am referring to as regarding those four who made my ignore list. With hindsight, I think these four were being paid to be here and to piss DUers off.

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=115&topic_id=103950

Lastly, fellow DUer kristopher (sp?) is familiar with these same names...he has held a wonderful battle with them...kicking their assess I might add. Check with him. (Btw: he is one of my DU heros but don't tell him that....his efforts to educate us and to battle those who promote nuke power goes unsung around here...he is DEFINITELY one of the good guys and right up there with the best DU has to offer)

[jeff47]

7. The loan isn't the gift. The way-below-market-rate interest on the loan is the gift. (nt)

[Xedniw]

34. +1000

Thumbs up

[Jake2413]

59. A loan is only a loan when there is specific pay back schedule

or pay back date, funny but I don't ever remember seeing one....

[girl gone mad]

9. Wrong.

A loan at 0% or any rate well below market rates at a time when the market was wholly unwilling to lend to these insolvent institutions amounts to a massive gift from the taxpayers to the corrupt, fraud-happy banks. Every time the money was loaned it was put at risk. When you side up to the roulette table 1,000 times, maybe you have a gambling addiction.

The fact that these banks had to depend on these massive loans is an indication of just how deep their losses were and how broken their business models had become.

You've defended Wall Street's looting from the very beginning, and you have been wrong. The economy wasn't fixed by the bailouts, it was further damaged. We aren't recovering because we saved these parasites, we are worse off for our leaders having taken such irresponsible actions.

[truedelphi]

58. I don't think your response "treed"

Properly, but totally follow your logic and wish you were in the Senate yourself.

Then Sanders wouldn't be the only one that understands this issue.

[joshcryer]

81. A loan at 0% interest is socialism at its finest.

[bvar22]

96. A MASSIVE "loan" at 0% or near 0%...

... given ONLY to the RICHEST .01% of our nation...

[font size=4]is NOT "Socialism".[/font]

It IS MASSIVE Theft from the people of our nation.

[Ruby the Liberal]

10. When you give someone an interest-free loan

(which for all intents and purposes it was) and they use that money to charge 30% on credit cards and to pay bonuses to the inhouse guys making side bets in the market, it is a fucking gift.

I'm surprised we didn't pay THEM to take the money...

[southernyankeebelle]

14. I totally agree with your observation. Don't you wish we could get free interest loans.

[abelenkpe]

13. ...

"This report reveals the inherent conflicts of interest that exist at the Federal Reserve. At a time when small businesses could not get affordable loans to create jobs, the Fed was providing trillions in secret loans to some of the largest banks and corporations in America that were well represented on the boards of the Federal Reserve Banks. These conflicts must end," Sanders said.

The point is those loans should have gone directly into making sure people were employed. These loans could have served the nation better had they been used to fund projects to rebuild our infrastructure or as lines of credit to small businesses. (The real job creators) Employed workers service their debt. They pay their taxes. The banks would have been made whole from the ground up. State and local governments would not be hurting for revenue. And the economy would be in better shape all around. No reason to kick the poor, old or disabled to the curb then.

I'm surprised you would call Sen Sanders a conspiracy theorist.

[mopinko]

17. i'm with you.

most of these loans were paid back, the taxpayers made money. you can hate on bankers all day long, but without a banking system, we are fucked. or at least, if the banking system we have crashes, we are fucked.
did it take too long to "trickle down" to the small businesses that were squeezed? yes. did it get there eventually? mostly. did we hit the kind of depths that we did in 1929? not by a long shot.

sadly, i think most of this discussion is driven by an "eat the rich" attitude. i think there are huge inequities in our economy, and in the world economy. the gap between rich and poor is horrendous. but sitting back in moral superiority and letting the banking system crash was JUST not an option.

[coalition_unwilling]

19. The question is not whether an industrial economy needs a banking system - it does -

but whether the rewards to and ownership of that banking system should remain privately controlled when its risks have been socialized. They should not. As a condition of being bailed out, those banks' assets should have been nationalized, share- and bond-holders wiped out.

Let's be clear here: when the banks were bailed out, the primary beneficiaries were the share- and bondholders of those banks. Why that particular segment of the economy gets singled out for favored treatment staggers the imagination.

[mopinko]

22. i find your suggestions absurd.

sorry. but that just ain't happening, and imho, shouldn't happen.

[coalition_unwilling]

26. Obviously it 'ain't happening,' but you provide

no explanation for why it shouldn't happen, other than to label the suggestion "absurd."

Please explain why insolvent financial institutions with the size and power to crash the world economy should remain privately owned.

N.B. The FDIC takes over insolvent banks all the time.

[mopinko]

30. the fdic

dissolves the assets in an orderly fashion, recoups any outlay they have made, and that is that. in the end of the s&l crisis, the tax payers made money also.

government just should not control the economy. i can see the reasons why people would want it to, i can see the benefits, but the downside is equally obvious.
look, i am not saying that everything is hunky dory. it isn't. bring back glass-steigle. get rid of bundled junk mortgages. but do you really want mitch mc connell with his hand in the banking system? i sure don't.

[coalition_unwilling]

31. The share- and bondholders of the TBTF banks (many of them in the 1%)

got bailed out and essentially rescued from the consequences of the risks they willingly undertook.

So many other people in this society and economy not in the 1% undertook no risk, or only dimly understood the risks they were taking (hence not "willingly&quot , but still must suffer the consequences without any bailout whatsoever.

So, hell yes, I want the government, i.e., the people of the U.S., to own the banking system, the same way the government owns the post office and the military.

[girl gone mad]

45. Your analysis relies on some fairly extreme historical revisions.

"most of these loans were paid back, the taxpayers made money."

I'm not going to get into a discussion on how the Fed operates, but it isn't correct to say that the taxpayers made money. First of all, many of these specific loans were paid back via secondary and tertiary government bailouts. Second of all, the Fed is still holding toxic assets purchased at mark-to-myth prices. It will be a long time before we know the ultimate outcome of these policy decisions.

"without a banking system, we are fucked. or at least, if the banking system we have crashes, we are fucked. "

Here you've offer up a false choice. Not a single critic of our bank bailouts was promoting the dissolution of the entire banking system. Most wanted to follow a course of action that is fairly standard and has been implemented many times throughout history. One which would have seen the bondholders and shareholders take losses rather than having all of those losses pushed onto the taxpayer.

"did it take too long to "trickle down" to the small businesses that were squeezed? yes. did it get there eventually? mostly. did we hit the kind of depths that we did in 1929? not by a long shot. "

There is no indication that the money ever trickled down to small businesses. Bank lending continued to decline after the bailouts. The only reason that we did not end up in a 1929 style depression is because of fiscal measures enacted by the federal government: the automatic stabilizers put in place after the Great Depression (unemployment, food stamps, etc., all of which increased sharply) and the stimulus and payroll tax cuts.

[2pooped2pop]

87. thank you for your rational post

you very calmly stated the facts. Good job. I give you the A++ for this thread.

[bvar22]

97. Well Done. Thank You!

Give me a Billion Dollars at 0%,
and I will gladly pay you back after a year.
I'll even give you .25% interest,
so you can claim to have "made money"!

[sendero]

65. Bankers should be basically..

... accountants that manage money. they have morphed into wild gamblers that pay themselves huge bonuses when they win and make the taxpayer pay when they lose.

the idea that we need these fuckers in their present form is ludicrous beyond words.

What we NEED in a complete reinstatement of Glass-Stegall which we will eventually get when the economy is nothing but a smoking heap of ruins, which is where we are headed.

[2pooped2pop]

86. ?????????wtf?????????????

It got fucking where eventually? You mean when the bankster ate dinner out on our dime and traveled the world on our dime and bought a yacht on our dime, that it trickled down in wages to the waitress, the travel company and the yacht company?

that ain't liquid gold trickling down on us. It's piss, pure piss.

wtmf?

[cheapdate]

91. The loans made by the Fed were exactly that...

Federal Reserve Bank loans. It was their (the Fed) money to loan and their decision to loan. The public, congress, and the taxpayers weren't involved. We're only indirectly affected by the Fed's decisions (in this case, their decision to hand over trillions of dollars in free cash to themselves and their friends.).

[abelenkpe]

103. You are confusing these loans with the TARP loans nt

[Bandit]

23. I would like a zero interest loan as well..

Why do they get trillions at zero interest and I get the shaft?

[taught_me_patience]

24. I'd call this a gift

"During the financial crisis, the Fed provided JP Morgan Chase with an 18-month exemption from risk-based leverage and capital requirements. The Fed also agreed to take risky mortgage-related assets off of Bear Stearns balance sheet before JP Morgan Chase acquired this troubled investment bank. "

[coalition_unwilling]

27. AKA: "Cash-For-Trash"

[sabrina 1]

53. I wonder why Geithner et al tried to keep it all

secret?

I guess they must have thought we little people wouldn't understand? They were right, we don't.

So Sen Bernie Sanders is a conspiracy theorist now?

Whose word on this would you respect btw?

[rustydog]

57. This was not a loan. It was a bailout

In 2008 the Administration tried to scare the shit out of us saying this needed to be done without REVIEW,
without arguement, without oversight and no chance of coming back later and charging people...it was a gift plain and simple.

[suffragette]

89. The Nation, Democracy Now, Reuters and more are reporting on this

http://www.thenation.com/blog/168351/senator-reveals-specifics-feds-conflicts-interest

http://www.democracynow.org/2012/6/13/headlines/report_firms_of_18_fed_directors_received_4_trillion_in_bailout_money

http://www.reuters.com/article/2012/06/12/usa-fed-conflicts-idUSL1E8HCAS420120612


And Sanders, Boxer and Begich have co-sponsored legislation to change this:

http://www.businessweek.com/news/2012-05-22/senators-seek-to-remove-bankers-from-12-regional-fed-boards
Senators Seek to Remove Bankers From 12 Regional Fed Boards


U.S. Senators Bernie Sanders, Barbara Boxer and Mark Begich introduced legislation today that would remove banking industry executives from the 12 regional Fed banks’ boards of directors.

“Allowing currently employed banking industry executives to serve as directors on the boards of directors of Federal Reserve banks is a clear conflict of interest that must be eliminated,” according to the text of the bill, released today by Sanders, a Vermont Independent who caucuses with Democrats.

This is “not a perceived conflict, but a real conflict of interest when bank presidents and employees of banks sit on the very boards that regulate them and sometimes bail them out,” Boxer said.


I would not call any of the above "nobody" "anonymous" or "conspiracy." And last I looked Boxer and Begich are Democrats and Sanders caucuses with Democrats which would make this issue one being brought up by our representatives.

[SOS]

94. A loan can easily be transformed into a gift

The Fed lends to banks at 0.25%.

Take that money and invest in bonds that pay 3-4%.

Pocket the difference.

If you could borrow a billion dollars at 0.25%, you could retire tomorrow
and live in luxury for the rest of your life.

It's a loan that gives you the gift of easy profits.

[Dont call me Shirley]

109. What Bernie was reporting was the CONFLICT OF INTEREST between the bankers who got the loans and

their seats on the various Federal Reserves. That is the issue.

[Angry Dragon]

3. Some of these people should be in prison

[southernyankeebelle]

16. Agree. But don't worry if things keep getting worse the little people are going to be in the

streets just like in Greece. Congress and the Senate is scared to death of riots in the streets. Sorry to say that might be the only way they finally listen to the people. All over the world the little people will raise up and government will have to listen and put the people first again and bring back order and put corporations where they belong.

[KoKo]

48. Yes...but "many more" than "SOME." But, they are HUGE DONORS to Both Parties....

FOLLOW THE MONEY!

[leftyohiolib]

92. if potus gets a 2nd term that might happen

[AndyA]

4. This kind of insanity just makes you want to bang your head against a wall.

Is it any wonder things are so screwed up? This is wrong on so many levels.

[rhett o rick]

5. Are the numbers you quote the amounts loaned or the amounts given? nm

[abelenkpe]

8. Article says:

"During the financial crisis, at least 18 former and current directors from Federal Reserve Banks worked in banks and corporations that collectively received over $4 trillion in low-interest loans from the Federal Reserve."

[rhett o rick]

56. Thanks I missed it. It would be good to know how much they actually netted. nm

[rhett o rick]

37. Wrong place. nm

Last edited Thu Jun 14, 2012, 08:25 PM - Edit history (1)

[valerief]

11. kick

[longship]

12. Every-bloody needs to read this

And make no mistake, the whole country is bloodied by these bailouts.

R&

Please let's get this one to the top of greatest.

[librechik]

15. ...and an outraged Congress is finally spurred into action!!!

[econoclast]

20. If you believe this story, perhaps you should

Apologize to Ron Paul ...

But seriously , I was curious to see just how the real data was tortured into aggregating to 4 trillion dollars

Found it in footnote of the original GAO report... To wit

If an institution borrowed 10 billion overnight, but each day, for thirty days, rolled over that 10 billion dollar loan it shows up in the aggregate "aggregate borrowing"  300 billion dollars.    If that same institution borrowed the same 10 billion dollars for the same 30 days but did the initial loan as a 30 day term loan instead, that loan shows up as "aggregate borrowing" of only 10 billion dollars.   

Cute!

This 4 trillion dollar figure is one of those "gee whizzz" numbers that has little bearing on what happened in reality, but is designed to elicit a particular response from the reader.

Like saying I have a 150,000 dollar mortgage.   I refinanced it  twice to get lower rates

According to this logic I  borrowed 450,000 dollars.

[Angry Dragon]

25. You did borrow $450,000

They did borrow those amounts in total

Did you also have a conflict of interest on your home loans??

[econoclast]

28. I think not.....

At no point was I ever in debt for more than 150,000.

The 4 trillion figure is an accounting sleight of hand. And the question you should ask is ... Why is Saunders clearly trying to bamboozle you? If it is REALLY as bad as Saunders says, why go through the chicanery to inflate the numbers?

And if it IS that bad ... Then Ron Paul is your guy.

[Angry Dragon]

70. I am not being bamboozled by Saunders

or you could ask why the banks need to keep borrowing the same amount over and over again
and as I stated before it is more of a conflict of interest OP than the amounts

and you yourself even said it was total aggregate amounts

and I must say I have never been tempted to vote for Paul.......

[girl gone mad]

50. Your analogy is imprecise..

and overnight loans is a bit of a misnomer in this instance, since the term on these "overnight" loans was extended to 90 days after the crisis, and the average term was well over 30 days. The peak outstanding bank support was well over 2 Trillion.

Don't kid yourself, this was a massive gift to the banks.

If you want a good real world analogy, imagine your alcohol and gambling addicted neighbor going to the bank every few days and asking for a loan to go play the slot machines. Then imagine the bank keeps giving him loans and charging no interest. Maybe he's paying them back, but who knows where he's getting the money because he isn't winning at slots and he isn't investing the money in the community. Is this really a smart move on the part of the bank?

[econoclast]

74. Actually quite precise indeed

Fact...
From
The inital GAO report

If an institution borrowed 10 billion overnight, but each day, for thirty days, rolled over that 10 billion dollar loan it shows up in the aggregate "aggregate borrowing"  300 billion dollars.    If that same institution borrowed the same 10 billion dollars for the same 30 days but did the initial loan as a 30 day term loan instead, that loan shows up as "aggregate borrowing" of only 10 billion dollars.   

This is very precise. And precisely indicates the accounting chicanery in the report.

The figures are deliberately inflated. That is a bald fact.

[girl gone mad]

112. The fact that the Fed..

repeatedly gave banks these sweetheart deals isn't making anyone feel any better about it.

Like I said, if the bank lends your irresponsible alcoholic gambling neighbor money at 0% over and over again, the bank may have a serious problem. If your neighbor has to take out loans from the bank every day because he's insolvent, has a gambling addiction, can't find work and no one else wants to give him money, maybe it's time for an intervention not more free loans.

[truedelphi]

106. The original number was fifteen or sixteen trillions of dollars.

I am rather confidant that the number was trimmed down to take into account exactly what you are saying.

And by the way, a lot of these firms have a strange notion of paying money back. Many of the banks that took TARP funds got tax deals rewarding them for the pay offs, almost equal to the value that they paid back. Other firms simply got a provision stating if they paid the original loan off, they would get a second deal for a TARP amount equal to the amount they paid back.

Wouldn't that be a nice kind of deal to get when dealing with our mortgages?

[econoclast]

115. Your confidence is misplaced

True, Saunders original number was 16 trillion and it was inflated exactly as I stated above. This new 4 trillion number is trimmed down indeed but not to remove the egregious over counting. This time around Saunders is using the same over counting sleight of hand, but only reporting it for banks whose managers were once part of the Fed.

It is the same old regurgitated, BS number, but reported for a smaller number of firms.

I can only suppose that the original iteration of this exercise using the 16 trillion figure was so clearly inflated that it got no traction. 16 trillion dollars is bigger than US GDP so it is clearly beyond the realm of credibility.

This new exercise uses the same discredited tecchnique, but I guess the thought is that by reporting it for a limited number of banks makes the 4 trillion number more believable. It's not. Still BS.

[truedelphi]

116. Catherine Austin Fitts still stands by the number 12 Trillions of dollars.

And she has mentioned a government official (maybe Neal Barofsky)_ who has as the number 28 trillion.

Anyway, I trust Bernie and Catehrine as people for my source.

[bonniebgood]

21. As I read this Senator jeff Session is on the

house floor talking about cutting food stamps. disgusting.

[DhhD]

69. Cutting food stamps in Texas was a disaster.

Yes Gov. Rick Perry laid off the state workers of the Federal food stamp program. Food stamps stopped. The mothers with children had to wait in line at food banks, and ask churches to feed their children and infants. It was a disaster. Texas could not find the trained special paperwork clerks needed. So reinstating the food stamp program stalled. Hunger continued. Finally the Federal Gov't fined the State of Texas about 3.7 Million dollars for messing up the Federal food stamp program.

Last summer large groups of youths got together and went in to small food stores and took foods, drinks, etc. and left without paying.

If hunger/famine happens nationwide, will mothers bring their children to local hospitals for the State's foster care to pick up the bills? Seems like food stamps are about $155.00 a month per child, at the most, for the poorest income brackets. No adults receive food stamps unless they are totally disabled. What is the cost of a child in foster care?

Here is another loop hole: Food stamps are with the Farm Bill that is being debated. Farmers can grow/produce enough food, very easily, to feed these children.

[girl gone mad]

71. Welcome to DU.

We have the resources and the capability to feed every child and yet our leaders choose to create an artificial scarcity of money so that a few can reap enormous profits. Our system is breaking down.

[woo me with science]

88. How seamlessly our representatives have transformed themselves into our "leaders."

Thank you for your posts here. I am always glad to see your contributions on any economic thread.

[Stuart G]

36. Required reading for everyone in this country that can read..

Truth is still the truth..
Banksters are crooks..enuf said..

[AnotherMcIntosh]

38. That which gets rewarded gets repeated. They'll be back for more.

The recipients of this largesse now have even more money to buy "our" politicians. "Our" politiicans, except for a few, are going to approve of the next bailouts as well.

[LittleGirl]

39. OMG

this is HUGE.

[SleeplessinSoCal]

41. Apparently we must hand deliver this list to all Americans. Our Corporate News Digest won't

[truedelphi]

64. And maybe somebody close to Pres Obama could mention that his

"good buddy" Tim Geithner was in the thick of the many manipulations and goings on while he headed the New York fed Reserve bank, Autumn 2008. Tim made sure that the good people at AIG and Goldman Sachs got a lot of these monies.

Ain't that grand - the same guy who refused the people of California a 20 billion dollar loan gave his friends trillions!

[SleeplessinSoCal]

75. Immelt of G.E. (owner of MSNBC, NBC, CNBC) got $16 billion . . . .

and if you Google this story under "news", you get nada.

[truedelphi]

105. Glad you reminded me of this.

I feel so terribly sad that this fall, I can choose between two basically Empty Suits - one a man who is the "Good Buddy"* of people like Immelt and Geithner, and the other of whom is an actual "self-made" billionaire, who spent his life destroying other people's lives so he could garner another 100K.

*Obama himself uses the phrase to describe his relationship with Geithner

Oh, and recently a review was posted about the media in various nations, and the USA's media ranked at 47 (or maybe it was even worse than that.)

[a2liberal]

43. Go Bernie! (n/t)

[SammyWinstonJack]

49. Well then...........

THANK GOD IT PASSED!

[malaise]

62. Holy facting shite!!

Four trillion dollars????

[Thinkingabout]

67. Bernie Sanders stood up and did wimp into a corner.

We have the spineless Boehner, cantor, demint and many others who can't lead anywhere but try to kick down the middle class but sugar coat the bankers and CEO because they might hurt their feelings. At least Jeb Bush, Lindsey Graham and Tom coburn has some footing under themselves.

[JDPriestly]

72. And this quote is the best:

Sanders on May 22 introduced legislation to prohibit banking industry and business executives from serving as directors of the 12 Federal Reserve regional banks.

http://readersupportednews.org/news-section2/318-66/11895-sanders-releases-explosive-bailout-list

Sanders gives me hope. It's hard to argue with his ideas. They are great.

[solarman350]

73. Wall St. OWNS all Three Parts of Our Government!

So, why put up with all this phony kabuki dance at the hearings? Why? We ALL know it is a sham...well most of us...except those perpetually/terminally stuck in cognitive dissonance mode.

[truedelphi]

117. I had never seen that sign before - thanks for the chuckle.

And it's nice to finally meet someone here who understands that when a Democratic Pres. chooses from the list of SCOTUS hopefuls, his employers are having him choose just about the same crowd that the Republicans would be giving to a Republican President.

Kagan was chosen in part for her being a "Monsanto" person, who will not halt the contamination of the food we eat, as she believes in industry scientists.

When "eminent domain" issue was brought before the SCOTUS several years back, it was the Republicans who thought it ridiculous to force a lower income person to give up their home so a country club or shopping mall could have their land. The Democratic justices ruled worse on that issue, and also on the medical marijuana issue.

[Flint Stone]

76. Is there any doubt left.....

that the financial industry is a State sponsored criminal enterprise???

It was disgusting watching Jamie Dimon's reception and testimony on the Hill the other day. All of his Senators couldn't wait to bow down and kiss his ring.

[Marvin33]

78. Spam deleted by Violet_Crumble (MIR Team)

[liberalla]

79. Citigroup received over $2.5 trillion

OMG - Citigroup sure is special, huh?

[font size=5]Citigroup received over $2.5[font size=8] TRILLION ![/font]

[abelenkpe]

101. And then laid off 50,000 workers nt

[abelenkpe]

102. O and then sharply raised interest rates and canceled lines of credit. nt

[Dont call me Shirley]

110. bush family related business

[Fuddnik]

80. Kick and rec

[Fantastic Anarchist]

90. And they say they hate socialism.

Unless, it's their kind.

[truedelphi]

107. + 1. n/t

[cheapdate]

93. It was the Fed's money to loan and their decision to loan it.

The public, congress, and the taxpayers weren't involved, nor was any public money.

The Fed is an independent body. How they choose to use their power to control the money supply is by design subject to very little control by the government or the public.

In this case, they decided to use their power to hand over, or "loan", trillions of dollars in free cash to themselves and their friends.

The whole thing looks rotten and corrupted. I'm not sure what the remedy is but I think major changes are called for.

[girl gone mad]

111. Taxpayers backstop the Fed.

The government absolutely should have a say in these decisions. This is why many on the left want to end the Fed as we know it and put control of our currency back in the hands of Congress rather than rentier bankers.

[cheapdate]

114. Greed, corruption, and hubris

at the Fed may be a huge problem for all of us who depend on the cash economy. As I said above, I think there is reason for major reform, even wholesale changes as you suggest.

While it may be splitting hairs, I don't believe it's correct to say that the "taxpayers backstop the Fed". The Fed controls the money supply. If they want or need more, they need only order more of it from the mint. They don't really need a backstop.

Unwise Fed policy may devalue money, even disastrously so. They may "loan" it out to their friends at the big banks who may then pocket much of it and then lose the rest in risky gambles (see 2007-2009 financial crisis) and THEN those big banks may be bailed out with taxpayer money, but the taxpayer isn't bailing out the Fed.

[patrice]

95. And now they're all busy buying a presidency for Rmoney.

[bvar22]

98. Paulson with Co-Conspirators

[font size=5]Paulson with Co-Conspirators

Now THIS is Bi-Partisanship!
Better get used to it!
Hahahahahahahahaha[/font]

For those who insist that our government is too monolithic to act quickly,
it took less than a week for the House, Senate, and White House to deliver the ransom money to the Wall Street Banks after Paulson posted his 3 page extortion note.

Our Government can strike faster than a rattlesnake
when their 1% portfolio is threatened.

[snot]

99. F.w.i.w.,

it was obvious at the time to anyone with even minimal financial savvy that this was what was going to be happening; it just wasn't talked about in those terms.

I.m.h.o., any congresscritter or reporter on financial matters who claims not to have understood this is either an idiot, negligent, or lying.

[Catch2.2]

104. Rec & Kick

We need more Bernie Sanders!

[Dont call me Shirley]

108. Bernie is AWESOME!