Apparently the FED just handed over 421.8 billion dollars last week.

[dixiegrrrrl]

But no one seems to know to whom, or why, or what if any collateral was exchanged.
( Did Bernanke give it to the Greek banks???)

Evidence:


Denninger's comments re: his chart, above:

That nice little vertical line is a gain of $421.8 billion dollars of outstanding loans and leases in one week's time.

WHERE THE HELL DID THAT MONEY GO AND WHAT COLLATERAL WAS TAKEN AGAINST A FOUR HUNDRED BILLION DOLLAR INCREASE IN OUTSTANDING LOANS?

http://market-ticker.org/

[SDuderstadt]

1. Read the caption at the top of the chart again....

"total loans and leases of COMMERCIAL BANKS".

[Poll_Blind]

2. Can someone help me understand more what this means and if it is "genuine"?

Please excuse me, I do not mean to impugn the OP, but first- is there an official government source I can pull this from? I know the graphic says its from www.federalreserve.gov- can someone help us find that data there?

Second, what the fuck does this mean? I mean, is this actually some sort of expected aspect of the previous financial bailout or is this almost half a Trillion more in one week?

What the fuck?

I'm going to start paying people in tulips if this shit keeps up.

PB

[dixiegrrrrl]

3. "What it means" seems to be a mystery to a lot of people.

I refer both of you who replied, to Denninger's link where he discusses why is a mystery
and
it might be helpful to read the forum discussion connected to the story, which I have been reading most of the evening, here:

http://tickerforum.org/cgi-ticker/akcs-www?post=134072

I just now got to p.8.of the discussion.

one point:
"The minimum reserves and the excess reserves of private (commercial) banks are held as FRB (Federal Reserve Bank) credit in FRB accounts. ..."

[Poll_Blind]

5. Thank you for the link. I'm still drowning in ignorance but at least...

...I have a wine cork to stare at.

:rofl:

The amounts of money being moved here worry the fuck out of me- before the big bailouts I remember a few weeks where the Federal Reserve (?) was moving around 30 billion, then 20 billion, then 70 billion or something like that.

And that was real.

This is quite a bit more money even than that.

I've heard some interesting responses in that thread- some of them I can vaguely grasp- but it looks like either there's something wrong/grossly misleading with the numbers themselves or there's still a mystery to be solved.

I lean more twoard mystery because it looks like folks have in there at least have partially tracked down that the numbers are real. The reason...is still to be discerned.

Thanks again.

PB

[TreasonousBastard]

6. I hate to say this but, there is this little matter of expertise in a subject...

snd the people who do understand all this, to the extent it is understood, have advanced degrees and many years experience dealing with it.

My poor widdle bachelors in economics doesn't qualify me to understand it, so I don't understand why anyone else outside of financial fields would expect to.

After all, how many here would be expected to understand an advanced paper in mathematics, or a surgeon's explanation of advances in kidney replacement? Why should the dark recesses of financial workings be any different?

A layman's guide, rather than trying to follow a discussion amongst self-appointed wonks, is in order here.

[dixiegrrrrl]

12. Well, the people who understand day to day are actually

more experienced as traders.
Some of them just have a lot of common sense.
The people with the degrees ..remember Bernanke, the expert of the Great Depression...seem to understand "concepts" more than real world.
How else can you explain all the "experts" who managed to blow up economies time after time after time,
then blame it on "the market" and "the public".?

Here's a graph that is easier for me to understand, once I realized that the term "nominal" really meant
" whatever value someone says it is worth". versus "actual" GDP.

[metapunditedgy]

4. I would like to know what's going on. Somebody please tell me? n/t

[Poll_Blind]

7. Well, the entry plus an "update" is here:

HERE

If you can understand the update, you're a better man than me, sir or madam. I think there's quite a bit of speculation that won't be answered until tomorrow.

I have no idea.

I have a thought for you and anyone else who reads this message:

Let's say that this is just misunderstanding something that is easily explainable. How bad have our times gotten when movement of money/credit of this magnitude is looked at seriously as another possible historic shift in currency to (somebody) instead of being dismissed as some sort of absurd error?

I probably could have worded that more succinctly but you get the drift (I hope)

PB

[chill_wind]

8. K & R.

I don't know the answer, but I certainly admire the question..

[donco]

9. Did Madoff make parole?

[Festivito]

10. Chart needs to go back to when Bush stopped reporting M3.

A few months later, some website that kept tracking the M3 itself stopped just as it went wildly upward, like 10 times what it had been after a slow steady rise starting in 1929.

I thought they were hiding credit derivatives.

Still don't know.

Have the chart at my office on 11x17. Not on my machine gosh darn it.

[econoclast]

11. Apparently Denninger can't read the chart ...

Coupl'a points ...

1. The data that show the additional 420 billion in loans is data about lending BY US commercial banks REPORTED by the Fed. Actually by the St Louis Fed. It is NOT data about lending BY the Fed. So the Fed didn't lend 420 billion to anybody. 

2. The increase in loans and leases by US commercial banks is impacted by two accounting rule changes. See below from a 2009 story on Bloomberg:

"At its board meeting earlier today, FASB voted to retain the effective date of its upcoming amendments to FAS 140, Transfers of Assets, and FIN 46R, Consolidation of Variable Interest Entities, such that the new standards - widely reported* to potentially place billions of dollars of off-balance sheet securitizations back on the balance sheet."

You can, if you want, google the fasb website and read them. But, trust me on this, they are a snoozefest. Suffice it to say that loans and leases that had been "sold" to Special Purpose Vehicles and were hence "off balance sheet" now have to be put back on the banks balance sheets. So several year's worth of lending activity got reclassified at the end of the 3rd quarter of 2010. Moreover, this reclassification was "factored in" when the Fed did the stress tests of the banks last year, so bank capital should be adequate to handle the loans put back on the balance sheet. In fact, if you want to know why bank lending had been declining - this is it.    This rule change has been the wind for a year now.     The banks have had to make room on their balance sheets for these "sold" loans that are now no longer "sold".

Another thing, since banks have been getting flogged recently over their "repo 105-type" window dressing at prior quarter ends, they might have cut back on that window dressing this quarter end.    From a transparency point of view these are good things. And now that these loans have been put back on balance sheet the banks have a better feel for their actual capital requirements, and if they are comfortable, perhaps some REAL new lending can happen. 

Of course if they are not comfortable.....we could see additional declines in real new lending.

[dixiegrrrrl]

13. Other people on the Ticker forum were coming to same conclusion.

With pro and con arguments about the consequences of the change.