Was the AIG $ from taxpayers or the Federal Reserve?

[MrPerson]

Does anyone know?

[vaberella]

1. I believe it was from Bailout money which came from taxpayers.

Although before the bailout money, I believe, they were receiving money from the Fed. I could be wrong on this point though.

[marketcrazy1]

3. FED = Treasury = TAXPAYERS

no matter how you slice it, the money came from US!!

[MrPerson]

4. No. The Fed is a private company.

[pnwmom]

7. No, it's quasi-public. Public with some private "components."

From wikipedia:

The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central banking system of the United States. Created in 1913 by the enactment of the Federal Reserve Act, it is a quasi-public (government entity with private components) banking system<1> that comprises (1) the presidentially appointed Board of Governors of the Federal Reserve System in Washington, D.C.; (2) the Federal Open Market Committee; (3) twelve regional privately-owned Federal Reserve Banks located in major cities throughout the nation acting as fiscal agents for the U.S. Treasury, each with its own nine-member board of directors; (4) numerous other private U.S. member banks, which subscribe to required amounts of non-transferable stock in their regional Federal Reserve Banks; and (5) various advisory councils. As of February 2006, Ben Bernanke serves as the Chairman of the Board of Governors of the Federal Reserve System. Donald Kohn is the current Vice Chairman.

http://en.wikipedia.org/wiki/Federal_reserve

[MrPerson]

9. But it isn't taxpayer money. It holds bank money.

[pnwmom]

11. I don't understand what you're saying. n/t

[MrPerson]

12. The Fed doesn't get its money from taxpayers.

It gets it from banks.

The purpose is to prevent bank runs.

The US Government uses the Fed to make payments but it still has a negative account.

[pnwmom]

17. Well, the U.S. government backs the Fed, so ultimately it's the same thing. n/t

[marketcrazy1]

19. every dollar the FED

prints, loans, guaranties or sells is backed by the full faith and credit of the United States.. ( thats us,, the taxpayers ) any profit they earn in excess of expenses is returned to the Treasury... it IS taxpayer money......

[MrPerson]

21. link, please

[marketcrazy1]

22. from Wiki........ research is simple,, you should try it!!

Independent within government
Further information: Central Bank Independence, List of United States independent agencies, and Independent agencies of the United States government

The Federal Reserve System is an independent government institution that has private aspects. The System is not a private organization and does not operate for the purpose of making a profit. The stocks of the regional federal reserve banks are owned by the banks operating within that region and which are part of the system.<29> The System derives its authority and public purpose from the Federal Reserve Act passed by Congress in 1913. As an independent institution, the Federal Reserve System has the authority to act on its own without prior approval from Congress or the President.<30> The members of its Board of Governors are appointed for long, staggered terms, limiting the influence of day-to-day political considerations.<31> The Federal Reserve System's unique structure also provides internal checks and balances, ensuring that its decisions and operations are not dominated by any one part of the system. It also generates revenue independently without need for Congressional funding. Congressional oversight and statutes, which can alter the Fed's responsibilities and control, allow the government to keep the Federal Reserve System in check. Since the System was designed to be independent whilst also remaining within the government of the United States, it is often said to be "independent within the government."<30>

The 12 Federal Reserve banks provide the financial means to operate the Federal Reserve System. Each reserve bank is organized much like a private corporation so that it can provide the necessary revenue to cover operational expenses and implement the demands of the board. Member banks are privately owned banks that must buy a certain amount of stock in the Reserve Bank within its region to be a member of the Federal Reserve System. This stock "may not be sold, traded, or pledged as security for a loan" and all member banks receive a 6% annual dividend.<30> No stock in any Federal Reserve Bank has ever been sold to the public, to foreigners, or to any non-bank U.S. firm.<32> These member banks must maintain fractional reserves either as vault cash or on account at its Reserve Bank; member banks earn no interest on either of these. The dividends paid by the Federal Reserve Banks to member banks are considered partial compensation for the lack of interest paid on the required reserves. All profit after expenses is returned to the U.S. Treasury or contributed to the surplus capital of the Federal Reserve Banks (and since shares in ownership of the Federal Reserve Banks are redeemable only at par, the nominal "owners" do not benefit from this surplus capital); the Federal Reserve system contributed over $29 billion to the Treasury in 2006.<33>

[MrPerson]

24. I don't see "backed by the full faith and credit" of the US

Maybe my eyes aren't so good.

[marketcrazy1]

28. ALL U.S. DOLLARS

are backed by the full faith and credit of the United States who`s main source of income is taxes..... who pays taxes? WE DO!! the people along with our corporations and small business. personal income taxes make up more than HALF of all government revenue and that DOES NOT include social security taxes that by themselves amount to about 35 percent of ALL revenue collected by our government....

[JackRiddler]

27. But a great deal of the money the Fed has provided in bailouts...

is either guaranteed by the taxpayer or raised through T-bill sales. The exact proportions are unclear because the Fed has been keeping the details out of view. This is the subject of the Bloomberg news lawsuit against the Fed. Its balance sheets have doubled within a year, this is without precedent, and it's not clear how each item is accounted. (Minutes of board meetings are kept secret for five years!)

The Fed can also create money without need of reserves.

[Tuesday Afternoon]

2. Stupid question:

Isn't the Federal Reserve comprised of taxpayer's money? If not, where does that money originate?

[yank3kilo]

5. Video might help

According to this youtube video it's the government > http://www.youtube.com/watch?v=Nay4VbUJl3E

[OHdem10]

6. Does not all money in US Government come from Taxpayers??

Where else does the Government get money??? Enlighten me please.

[MrPerson]

8. The Fed Reserve controls the money supply and makes loans

It is separate from the Treasury.

[marketcrazy1]

14. it is seperate from the treasury

but it`s money is OURS. backed ENTIRELY by U.S. treasury bonds. ( or at least it was! now the majority of FED holdings are asset backed securities!)

[MrPerson]

16. The money belongs to bank depositors.

i.e. Rich People.

[havocmom]

10. Lately, from China

[MrPerson]

13. Yep. They buy our T-Bills.

[Winterblues]

25. Well take the USPO for instance

It makes it's money from the sales of postage and other things. I am sure there are other agencies that also make their own money and do not rely upon tax payer money.

[Greyhound]

30. The USPS was morphed into a quasi-governmental organization some time

ago. It is, as far as I know, the only such monstrosity, we have so far.

BTW, did you know that the "losses" so widely reported a couple months ago are caused by the requirement that the USPS subsidize UPS and FedEx?

[kentuck]

15. Both

The first from the Fed. The second from Congress.

[MrPerson]

18. I thought so.

And the money was loans, which can be recalled.

[glowing]

20. Fed, but the Fed is backed by US taxpayers.

[ProfessorGAC]

23. The Answer Is Yes

But, it's really more than 50:50, because even Bernanke admitted on 60 Minutes that the Fed is printing extra money.

They can't do that independently. They need the permission of the Treasury. So, since all the money is fiat cash backed by the good faith of the U.S. gov't, and the people are the preponderant source of revenue to the gov't, then any of the new money is, in effect, tax payer money.

Also, when new money is printed with no new production or supply to rationalize it, it makes all the rest of the money worth a little less. (It's not one to one. It's more arcane than that.)

So, in another indirect way, any Fed money is really owned by the people, and any new money is effectively taxpayer money.
GAC

[MrPerson]

26. So there is no 1:1 correspondence.

The US can monetize a loss by printing more $.

[ProfessorGAC]

29. Well, It's Not 1:1 If We Don't Get Carried Away

It went beyond 1:1 when Brazil went nuts printing money. A little added cash to the M1 will diminish the value of the existing dollars by some, but not necessarily fully proportional. The more we print, the worse the deal gets.

It's happened lots of times in our history.
GAC