The Fed Bailouts: Money for Nothing

[Alan Grayson]

I think it’s fair to say that Congressman Ron Paul and I are the parents of the GAO’s audit of the Federal Reserve. And I say that knowing full well that Dr. Paul has somewhat complicated views regarding gay marriage.

Anyway, one of our love children is a massive 251-page GAO report technocratically entitled “Opportunities Exist to Strengthen Policies and Processes for Managing Emergency Assistance.” It is almost as weighty as that 13-lb. baby born in Germany last week, named Jihad. It also is the first independent audit of the Federal Reserve in the Fed’s 99-year history.

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.

Page 205 – Separate and apart from these “broad-based emergency program” loans were another $10,057,000,000,000 in “currency swaps.” In the “currency swaps,” the Fed handed dollars to foreign central banks, no strings attached, to fund bailouts in other countries. The Fed’s only “collateral” was a corresponding amount of foreign currency, which never left the Fed’s books (even to be deposited to earn interest), plus a promise to repay. But the Fed agreed to give back the foreign currency at the original exchange rate, even if the foreign currency appreciated in value during the period of the swap. These currency swaps and the “broad-based emergency program” loans, together, totaled more than $26 trillion. That’s almost $100,000 for every man, woman, and child in America. That’s an amount equal to more than seven years of federal spending -- on the military, Social Security, Medicare, Medicaid, interest on the debt, and everything else. And around twice American’s total GNP.

Page 201 – Here again, these “swaps” were of varying length, but on Dec. 4, 2008, there were $588,000,000,000 outstanding. That’s almost $2,000 for every American. All sent to foreign countries. That’s more than twenty times as much as our foreign aid budget.

Page 129 – In October 2008, the Fed gave $60,000,000,000 to the Swiss National Bank with the specific understanding that the money would be used to bail out UBS, a Swiss bank. Not an American bank. A Swiss bank.

Pages 3 & 4 – In addition to the “broad-based programs,” and in addition to the “currency swaps,” there have been hundreds of billions of dollars in Fed loans called “assistance to individual institutions.” This has included Bear Stearns, AIG, Citigroup, Bank of America, and “some primary dealers.” The Fed decided unilaterally who received this “assistance,” and who didn’t.

Pages 101 & 173 – You may have heard somewhere that these were riskless transactions, where the Fed always had enough collateral to avoid losses. Not true. The “Maiden Lane I” bailout fund was in the hole for almost two years.

Page 4 – You also may have heard somewhere that all this money was paid back. Not true. The GAO lists five Fed bailout programs that still have amounts outstanding, including $909,000,000,000 (just under a trillion dollars) for the Fed’s Agency Mortgage-Backed Securities Purchase Program alone. That’s almost $3,000 for every American.

Page 126 – In contemporaneous documents, the Fed apparently did not even take a stab at explaining why it helped some banks (like Goldman Sachs and Morgan Stanley) and not others. After the fact, the Fed referred vaguely to “strains in the financial markets,” “transitional credit,” and the Fed’s all-time favorite rationale for everything it does, “increasing liquidity.”

81 different places in the GAO report – The Fed applied nothing even resembling a consistent policy toward valuing the assets that it acquired. Sometimes it asked its counterparty to take a “haircut” (discount), sometimes it didn’t. Having read the whole report, I see no rhyme or reason to those decisions, with billions upon billions of dollars at stake.

Page 2 – As massive as these enumerated Fed bailouts were, there were yet more. The GAO did not even endeavor to analyze the Fed’s discount window lending, or its single-tranche term repurchase agreements.

Pages 13 & 14 – And the Fed wasn’t the only one bailing out Wall Street, of course. On top of what the Fed did, there was the $700,000,000,000 TARP program authorized by Congress (which I voted against). The Federal Deposit Insurance Corp. (FDIC) also provided a federal guarantee for $600,000,000,000 in bonds issued by Wall Street.

There is one thing that I’d like to add to this, which isn’t in the GAO’s report. All this is something new, very new. For the first 96 years of the Fed’s existence, the Fed’s primary market activities were to buy or sell U.S. Treasury bonds (to change the money supply), and to lend at the “discount window.” Neither of these activities permitted the Fed to play favorites. But the programs that the GAO audited are fundamentally different. They allowed the Fed to choose winners and losers.

So what does all this mean? Here are some short observations:

(1) In the case of TARP, at least The People’s representatives got a vote. In the case of the Fed’s bailouts, which were roughly 20 times as substantial, there was never any vote. Unelected functionaries, with all sorts of ties to Wall Street, handed out trillions of dollars to Wall Street. That’s now how a democracy should function, or even can function.

(2) The notion that this was all without risk, just because the Fed can keep printing money, is both laughable and cryable (if that were a word). Leaving aside the example of Germany’s hyperinflation in 1923, we have the more recent examples of Iceland (75% of GNP gone when the central bank took over three failed banks) and Ireland (100% of GNP gone when the central bank tried to rescue property firms).

(3) In the same way that American troops cannot act as police officers for the world, our central bank cannot act as piggy bank for the world. If the European Central Bank wants to bail out UBS, fine. But there is no reason why our money should be involved in that.

(4) For the Fed to pick and choose among aid recipients, and then pick and choose who takes a “haircut” and who doesn’t, is both corporate welfare and socialism. The Fed is a central bank, not a barber shop.

(5) The main, if not the sole, qualification for getting help from the Fed was to have lost huge amounts of money. The Fed bailouts rewarded failure, and penalized success. (If you don’t believe me, ask Jamie Dimon at JP Morgan.) The Fed helped the losers to squander and destroy even more capital.

(6) During all the time that the Fed was stuffing money into the pockets of failed banks, many Americans couldn’t borrow a dime for a home, a car, or anything else. If the Fed had extended $26 trillion in credit to the American people instead of Wall Street, would there be 24 million Americans today who can’t find a full-time job?

And here’s what bothers me most about all this: it can happen again. I’ve called the GAO report a bailout autopsy. But it’s an autopsy of the undead.

Courage,

Alan Grayson

[blm]

1. KandR

truth up

[Roy Rolling]

58. Truth, for sure

This is an important financial/business story. But what is Fox Business reporting? While the Fed bankrupts the U.S. they are reporting on how the Muppets are brainwashing children with liberal ideas.

[blm]

67. FOX won't let its audience hear anything unless it somehow serves the privileged elite

That's why disinformation campaigns are almost always the order of the day there.

[msongs]

2. in a nation of white flag waving democrats, Alan Grayson is a treasure nt

[ejbr]

48. +1000 n/t

[xiamiam]

51. you got that right..especially when i read the hogwash gallup polls here regularly

how can anyone support any party or any politician who turns a blind eye to this?

[Zorra]

3. occupy...and support

Alan Grayson for Congress
:-)
http://www.congressmanwithguts.com/?track=googseo

[banned from Kos]

4. Mr. Grayson - Do you approve of a Lender of Last Resort in concept?

Using required collateral, of course.

Or should banks return to the 19th century model of boom and bust?

[girl gone mad]

27. Do you even understand the role that "lender of last resort" was designed to encompass?

Borrowing institutions were always required to meet basic standards of solvency, collateral and legality, for instance.

These traditional standards were not applied in 2009. Far from being a "lender of last resort," the Fed acted more like a "slush fund of first resort".

[banned from Kos]

28. I actually made a point of collateral - you socialists need to understand that

capital is a collective endeavor. Banks are collectively a community concept.

[girl gone mad]

37. My point was that the traditional standards for collateral were not met.

Read the post again when you aren't so angry.

[sabrina 1]

43. Banks are welfare queens. They take trillions in tax dollars

after they fail, then hoard it somewhere and pay themselves huge bonuses, and go back again for more.

Most of us have earn money. We don't get government handouts when we fail. In fact no one except these banks get that kind of charity.

The whole system has to go, it is corrupt, it is a failure, and it has collapsed the World's economies, destroying the lives of millions and millions of innocent people.

And we probably only know a fraction of the crimes they have committed.

THANK YOU Rep. Grayson and Ron Paul for forcing that shocking information out of them.

Criminals are running this country. We need one hundred Graysons in Congress to start turning this country around.

[sabrina 1]

49. Yes it is a collective endeavor. Now that the top 1% has

collected most of this country's wealth, we realize that, too late.

Capitalism has failed, spectacularly and anyone who still tries to say it hasn't is deluded, or one of them. All 'isms' fail in the end.

The only countries still surviving are the Northern European Socialist countries, they were not fooled by the greedy, selfish 'philosophy' now known as Capitalism. It is in its last throes, thankfully.

[Enthusiast]

72. "Yes it is a collective endeavor."

"Now that the top 1% has collected most of this country's wealth, we realize that, too late."


:rofl: :rofl: :rofl: Hey, that ain't funny.

[Bluenorthwest]

56. Wow! Calling Democrats socialists as if it was an insult...

The right does that to Obama. Yes they do. He's a socialist. He does not understand, socialists don't understand, you see. Sweden is a dirty backwater, you know.

[banned from Kos]

84. Sweden is not socialist. They are capitalist and they have a central bank like the Fed.

There are self-professed socialists here. There is nothing wrong with citing that. But that is not our system. We have a central bank like all modern economies. In fact, ours is regarded as the best.


I recognize that some people here wanted a total failure of our financial system. Obama and every elected Democrat I know of did not.

[Myrina]

64. "You socialists need to understand that"

:rofl: :rofl: Now I understand your username. :rofl: :rofl:

Enjoy your stay.

[Enthusiast]

70. Little wonder you were banned. nt

[loudsue]

81. Kos made a good decision. n/t

[chervilant]

87. Well now,

your posts of late are sadly delusional. Calling people with whom you disagree "you socialists" suggests you are a wolf in sheep's clothing. If you are so supportive of the uber wealthy corporate megalomaniacs, you might want to reconsider which websites you frequent.

[banned from Kos]

32. Additionally, despite the self-induced pain inflicted on the financial community, they are solvent

and legal (and posted collateral).

Your post is a complete failure.

[inna]

35. no wonder some get banned even from Kos

:crazy:

:wow:

[UnrepentantLiberal]

59. My thought exactly.

Now we know who gets banned from the Daily Kos. Who needs a Wall Street PR bot singing spirituals about Wall Street's "self induced pain"?

[City Lights]

69. !

:thumbsup:

[fasttense]

53. How about the banks just let the free market work their magic on them?

The Fed has been no more successful at preventing this huge boom and bust cycles we now call the Great Recession then it would have been if it did not exist.

The only thing the Fed has been able to do is keep the rich rich and out of jail.

[UnrepentantLiberal]

60. Yep, a government sponsored welfare program for people who steal

from the serfs and give to the rich. It makes you sick when you think of hard working American citizens who were hit hard by the recession created by these banks and are now getting the run around by these bailed out banks as they try to save their homes.

[City Lights]

5. K&R. eom

[Gregorian]

6. It's time we all start talking about the Federal Reserve.

It's a cartel of banks that use it as a means by which they write bad checks to themselves, and charge us interest to borrow the money they made from vapor.

The Fed is a fence. It just hides and legitimizes the fact that the 1% is getting rich, all while diluting our economy. It's a form of tax on us which is not even declared nor even known by most.

I think this may be the most important discussion of any, since it is how our wars are funded. From thin air.

[banned from Kos]

9. Total bullshit. Talking about the Fed is fine - let's start with facts.

You have none so far.

[Gregorian]

11. Well what about this-

And I fully know this guy is a John Birch member. But read his speech. He's only talking facts.

http://www.bigeye.com/griffin.htm

[banned from Kos]

15. Are you serious? You are propagating Bircher shit here? Mods, please leave this up.

Do you know who Griffin is?

http://en.wikipedia.org/wiki/G._Edward_Griffin

He is a fraud, a child actor, a medical quack who tried to sell laetrile as a miracle cure for cancer. He "found" Noah's ark. He is also Ron Paul's mentor.


You are a victim of deception.

[Gregorian]

18. The points he makes in the speech are all seemingly valid.

It would be interesting to hear a counter argument. Ad hominem doesn't cut it. I am asking people on this forum to help me with this, since I also have doubt about someone who hangs out with Beck and Cramer. If you read the speech you'll see that he uses historical facts to back up his claims. And they sure makes sense to me.

[Rex]

13. Right and so far you've given nothing to the conversation

but whining about other peoples point of view.

Let us start with facts...can you produce any?

[banned from Kos]

17. yeah - the Fed's loans to banks produced a $125 billion profit PAID to us tax-payers!

http://latimesblogs.latimes.com/money_co/2011/01/federal-reserve-2010-record-profit-financial-crisis-intervention.html

(2009 + 2010 combined)

[bertman]

24. I never got my dividend check. How do I get it? nt

[banned from Kos]

30. Well, despite the $125 billion the Fed made we are still running $1 trillion deficits

Your wait (and mine) will last at least 50 years.

[sabrina 1]

50. LA Times is a rightwing rag.

[PoliticAverse]

78. lol. Yeah bank bailouts made taxpayers billions. Pay no attention to the figures behind the curtains

[fasttense]

54. Well, you don't seem to be providing any facts of your own. n/t

[DeSwiss]

7. K&R n/t

[mojowork_n]

8. Any hope from the courts? Matt Taibbi's quick update last week...

http://www.rollingstone.com/politics/blogs/taibblog/federal-judge-pimp-slaps-the-sec-over-citigroup-settlement-20111129

In one of the more severe judicial ass-whippings you’ll ever see, federal Judge Jed Rakoff rejected a slap-on-the-wrist fraud settlement the SEC had cooked up for Citigroup....

...Judge Rakoff blew a big hole in that practice yesterday. His ruling says secret justice is not justice, and that the government cannot hand out punishments without telling the public what the punishments are for. He wrote:

Finally, in any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth. In much of the world, propaganda reigns, and truth is confined to secretive, fearful whispers. Even in our nation, apologists for suppressing or obscuring the truth may always be found. But the S.E.C., of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if it fails to do so, this Court must not, in the name of deference or convenience, grant judicial enforcement to the agency's contrivances.

Notice the reference to how things are “in much of the world,” a subtle hint that the idea behind this ruling is to prevent a slide into third-world-style justice. There are many such loaded passages in Rakoff’s ruling. Another one comes up around the issue of the “public interest.”

Read more: http://www.rollingstone.com/politics/blogs/taibblog/federal-judge-pimp-slaps-the-sec-over-citigroup-settlement-20111129#ixzz1fhX1TBuf

[banned from Kos]

10. That has nothing to do with the Fed - its about the SEC and its regulations.

Did Citi knowingly mislead investors? Who has legal standing?

Those are the pertinent questions.

[mojowork_n]

19. Who does have legal standing?

Oversight? Jurisdiction?

Without going back to Jekyll Island and the whole history of the Fed,
today (right now)-- given how far and wide the penetrations of the giant
vampire squid reach -- who's going to take a whack at any one of them?

Tentacle by tentacle, by money-sniffing blood funnel, it's a financial

...system.

Somebody has to start somewhere.

[banned from Kos]

33. Congress n/t

[mojowork_n]

61. Maybe, but to get Congress moving

It's going to take a mob -- a perfect storm of mobs -- with torches and pitchforks.

Or the Occupy movement.

Or individuals starting to talk to other individuals, who talk to others, who will
all get the ball rolling.

Journalists, judges, what the demographers used to call, "opinion leaders."

Congress is bought and paid for. Both parties. Even Bill Moyers, most recently,
came on board to express doubts about their integrity.

[Enthusiast]

74. They. Are. Owned.

[Enthusiast]

73. + a brazillion!

[Suich]

12. K&R!

:kick:

[Rex]

14. I don't know how you stay sane.

All the waste and misuse of govt by corporations and FOR corporations...I'd have lost it trying to deal with these kind of people.

Bless you and keep the hammer swinging!

[Hotler]

16. k&r n/t

[bvar22]

20. Thank You, Mr Grayson.

I'm glad you posted this information.
A TRILLION Dollars is beyond my comprehension.
I can see the numbers and count the zeros,
but I can't wrap my brain around the magnitude of that much money.

I'm glad you broached the issue of inflation.
Has anybody offered an educated opinion on the Real World consequences of the FED "creating" so much money?

:patriot:



You will know them by their WORKS,
not by their excuses.
Solidarity99!
--------------------------------------------------------------------------------------------------------------------------------

[Autumn]

21. I love you.

You Sir, are treasure. Thank you for caring.

[mojowork_n]

22. RE: Observation (3)... the role of European banks?

In principle, sure, you have to ask what are we doing bailing out UBS.

But the fact that payments were made:

Page 129 – In October 2008, the Fed gave $60,000,000,000 to the Swiss National Bank with the specific understanding that the money would be used to bail out UBS...

suggests there must have been a reason, some sort of compelling argument?

Not long ago, I read this, from a dKos blogger. If the reporting is accurate
on the facts, it does suggest a reason:

(Sept. 15th) http://jerome-a-paris.dailykos.com/

...some of the most likely victims of the current banking crisis in Europe are going to be in the US. Yesterday, I talked to a colleague in a big European bank who confirmed this in stark terms: they (and other European banks) have no problem finding long term funding in euros, and are still finding short term funding in dollars, but they are no longer having enough long term funding in dollars.

Which means that European banks have basically stopped lending to US / dollar clients (something which includes the whole shipping and aviation industries worldwide...). And while that may sound innocuous, the underlying reality is that US banks do not do long term lending - close to 100% of long term lending (as opposed to bond financing) in the USA is done by European banks (and a few Japanese and Canadian ones). To give you an example, over 2010, of the 50 largest banks active in project finance (ie long term financing of infrastructure projects like bridges, power plants, hospitals, mines, etc...) in the USA, only a handful were American, with insignificant volumes contributed....

...US banks find disintermediated finance (underwriting bonds and selling them to investors) more attractive - the real reason of course is that bankers make bigger bonuses selling bonds than negotiating loans, and banks take less risk...

[chervilant]

23. Actually,

The obscenely wealthy corporate megalomaniacs are scurrying around like cockroaches in the dawning light because their wealth is an illusion. Their hedonism has resulted in the massive Black Hole that the brave and erudite Brooksley Born called the Dark Market. With a current notional value of $680 TRILLION, the 'worth' of these worthless financial instruments exceeds the combined GNPs of EVERY NATION ON THIS PLANET by a factor of ten.

The entire system IS broken, and the banks ARE parasites.

Time for change. I am ever more hopeful, now that #Occupy is spreading across the globe.

[Quantess]

25. Thank you so much for posting this!

It's such a colossal mess!
:hi:

[Octafish]

26. Even the mols turned a buck.

Why is the Federal Reserve forking over $220 million in bailout money to the wives of two Morgan Stanley bigwigs?

EXCERPT...

It's hard to imagine a pair of people you would less want to hand a giant welfare check to — yet that's exactly what the Fed did. Just two months before the Macks bought their fancy carriage house in Manhattan, Christy and her pal Susan launched their investment initiative called Waterfall TALF. Neither seems to have any experience whatsoever in finance, beyond Susan's penchant for dabbling in thoroughbred racehorses. But with an upfront investment of $15 million, they quickly received $220 million in cash from the Fed, most of which they used to purchase student loans and commercial mortgages. The loans were set up so that Christy and Susan would keep 100 percent of any gains on the deals, while the Fed and the Treasury (read: the taxpayer) would eat 90 percent of the losses. Given out as part of a bailout program ostensibly designed to help ordinary people by kick-starting consumer lending, the deals were a classic heads-I-win, tails-you-lose investment.



Gee. Wouldn't it be more, uh, democratic if everyone had a piece of the action?

PS: A hearty welcome to DU, Alan Grayson! Thank you for an excellent post and PDF!

[WillyT]

29. K & R !!! - Bookmarked !!!

:hi:

:kick:

[midnight]

31. Is it true that some bankers were forced to take this bailout money?

[inna]

34. Alan, you're the BEST!!!

[snagglepuss]

36. You're simply the best. As Yeats wrote "Education is not filling a bucket, but lighting a fire."

:yourock:


Thanks for posting.

[dotymed]

38. Bookmarked for later, a lot of content there. Thanks Alan.

Will you primary Obama? Please?

[truedelphi]

39. Well if Grayson is to be believed,

And I for one believe him, then this occurred:
Page 129 – In October 2008, the Fed gave $60,000,000,000 to the Swiss National Bank with
the specific understanding that the money would be used to bail out UBS, a Swiss bank. Not an
American bank. A Swiss bank.
End of quote.
But by summer of 2009, when the governor of California asked Tim Geithner for a loan, a gawdamn loan for Pete's sake, that would benefit 37 milllion Americans that actually live in the USA, the governor was shut down by lil Timmy's snappy quote that lending the state of California would cause too large a hike in the US government's deficit. I guess only Big Bankers count for anything in the world of Tim Geithner and Ben Bernanke.

But the US government's deficit hadn't bothered Timmy the Elf the previous autumn. Back then he was happy to offer up uncounted billions to AIG and Goldman Sachs. And never has Tim Geithner denounced all the loans that were made by Bernanke to the European banks.


We really need a total system reset. Maybe we should get rid of the current system for something
else. There should be income mean's testing so not everyone in Congress should be millionaires.

David Wallechinsky and Amy Wallace mentioned in one of their books that perhaps we are at a point when selecting our President and Congress by random chance makes as much sense as the "current system." And they wrote out this idea more than a decade ago, when things were not anywhere near so broken.

[WildNovember]

40. us gdp: $14.5 trillion

so the fed can loan banks, even foreign banks, more than the us gdp, but everyone else has to suffer budget cuts because there's "no money"?

ridiculous.

[newspeak]

66. and after that bailout

banks weren't helping small businesses either. My hubby was laid off because the bank wouldn't lend money to his boss who had been a customer for years. Small businesses are going under also.

I will never forget that little boots is the one who allowed this mess to become a nightmare. Right before an election, basically telling congress "oh, look I screwed up, you better bail out my buddies or we're going down fast." But, here on DU, some of us were the cassandras, while others thought we were chicken little. Knowing little boot's concepts of allowing business to police themselves with little regulation, knowing little boot's "alleged" insider trading that daddy's friend let go away and Neil's role in the S&L theft--why would anyone think it would be different. Instead of economically destroying a state, we allowed him to destroy the country.

[DCKit]

41. Boy Howdy, would I ever love to know how many unrecs this OP got.

Look forward to seeing you back in DC soon, Congressman.

[DCKit]

42. Boy Howdy, would I ever love to know how many unrecs this OP got.

Look forward to seeing you back in DC soon, Congressman.

[sabrina 1]

44. They collapsed the world and then printed up money to try

cover up their crimes. And still no prosecutions, and since they got away with it, the biggest Bank Heist in history, you are right, Rep. Grayson, it can happen again.

I'd like to know why the same people who caused this Global catastrophe are the ones trying, and failing (see Europe right now) to fix it.

Thanks YOU for all you do for the American people. I can't wait until you win the election and return to Congress.

[Scurrilous]

45. K & R

:thumbsup:

[Norrin Radd]

46. kr

[mmonk]

47. Courage is the word.

Who got the haircut was influenced a lot by Goldman Sachs. I wish we could go back to trust busting and real regulation. The under the table invisible "liquidity" needs to be stopped and an ongoing monitoring process needs to appear. Maybe the fed needs to be put under Treasury.

Thanks for all you do and may you win your next election.

[Starry Messenger]

52. k&r

And Amen to #6. And then be told we all have to "eat our peas".

[Huey P. Long]

55. kr!

[fasttense]

57. And the Fed is about to bailout those European banks yet again.

How many more bailouts of investment firms will the Fed do to keep the rich rich and out of jail? When do the working class get bailed out?

Just remember that before September 2008, Goldman Sachs and Morgan Stanley were NOT traditional bank holding companies. They were NOT protected by the Fed because they were merely investment banks. They became traditional bank holding companies in 2008, so that they could get bailouts. The Fed approved this change right in the middle of biggest economic crash in history. The Fed did the same thing for a lot of other non-banking investment firms so that we the people could bail them out. So we really did NOT bail out banks. We bailed out investment firms.

[suffragette]

62. "Unelected functionaries, with all sorts of ties to Wall Street,

handed out trillions of dollars to Wall Street."

Sums it up rather well.

And they want the 99% to foot the bill, through Austerity cuts to a large part of what makes us a society - social programs.

K&R

[PoliticAverse]

63. "then pick and choose who takes a “haircut” and who doesn’t, is both corporate welfare and socialism

I'd call it 'textbook crony capitalism'.

[Huey P. Long]

65. Its also fascism, but nobody wants to use that term. -eom

[Enthusiast]

68. All that and the assholes don't want their precious

derivatives regulated. Little wonder!

Understand this, when they should be in prison for decades they are dictating to our elected politicians what they are allowed to regulate and reform. There is something very wrong with this picture.

[Fearless]

71. This thing reaks of Ron Paul xenophobia.

The fact is that the real issue here isn't that we are giving this money to foreign banks (et. al) but that we are secretly giving money to which there is no accountability while the American people suffer and get NOTHING. If in fact we ignore the fact that the American people are getting nothing for the moment, the fact that foreign entities are shouldn't be a surprise. The world is heavily interconnected and what affects one affects all. Just look at the debt crises in Western Europe and how they have impacted the world economy AND realize that these banks have MORE assets involved in the economy than these nations. The impact would be much greater.

What should have happened is this: There should have been a component for the American public. Then in regards to banks (et. al.) the federal government should have broken them up and settled their debts instead of allowing them free reign with our money and allowing them to continue their ill-advised derivative and lending practices.

[Yuugal]

75. k&r nt

[klook]

76. And some of these same welfare freeloaders

have illegally foreclosed on active-duty service members' homes while they were overseas. When will they go to jail for that, I wonder?

Thanks very much for doing the hard work of reading through this monster and giving us some of the lowlights. We need much better oversight of the Fed, and we need to break up the megbanks.

Mr. Grayson, I'm so happy that you are posting on DU, and I sure do look forward to your return to Congress. Keep up the good work.

[Hubert Flottz]

77. K&R

Welcome to DU Congressman Grayson.

[nashville_brook]

79. kickety rekety

[Melissa G]

80. K&R for Alan Grayson- a little lukewarm on your congressional spouse

But Yay for your lovechild! Thanks for the post!:yourock:

[LuckyLib]

82. If you want your blood pressure raised even more, watch again "Inside Job" --

the documentary makes my blood boil. These are criminals and we are controlled by an incestuous criminal enterprise. Obama, who should have cleaned house and let loose some heavy prosecution of these thugs, invited the wolves into the henhouse.

[Name removed]

83. Deleted message

Message removed by moderator. 
[link:www.democraticunderground.com/forums/rules.html|Click
here] to review the message board rules.

[banned from Kos]

85. Welcome, Ron Paul fan! Hang around - let's talk Fed!

Are you a Griffin fan? (Creature from Jekyll Island)

[Kaleko]

86. kick