Reply #8: If you don't want to understand basic economics, that's fine with me

[Hydra]

But where do you think the Fed gets the money to lend? They are authorized agents of Congress vested with the power to create currency, and that currency is backed by nothing more than legal order that it must be accepted "For all debts, public and private."

We have a fiat currency- we went off the gold and silver standard decades ago. We have also rejected the fractional reserve system, meaning that you can loan any amount with no monetary backing.

This is all an open secret. Read the information and read how the financial system ACTUALLY works before you defend the bailout of a company that doesn't need it.

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Edit:

You're probably plugging your ears, but here's a good tidbit for you:

The $5 trillion in owned or guaranteed mortgages at the two companies is backed by less than $100 billion in actual capital. That's leverage of 50-to-1.

http://articles.moneycentral.msn.com/Investing/JubaksJo...

They were borrowing all of that money from the Fed at a special rate, who in turn was creating that money from thin air.

Now are we starting to get the picture?