Monday, November 10, 2008

Fed Refuses to Identify $2 Trillion in Bank Loans

The shameless looting of the public treasury continues unabated

Per Bloomberg.com:

Fed Defies Transparency Aim in Refusal to Identify Bank Loans

Excerpts from this morning's hot-off-the press story:
Nov. 10 (Bloomberg) -- The Federal Reserve is refusing to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral.
Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would comply with congressional demands for transparency in a $700 billion bailout of the banking system. Two months later, as the Fed lends far more than that in separate rescue programs that didn't require approval by Congress, Americans have no idea where their money is going or what securities the banks are pledging in return.
"The collateral is not being adequately disclosed, and that's a big problem," said Dan Fuss, vice chairman of Boston- based Loomis Sayles & Co., where he co-manages $17 billion in bonds. "In a liquid market, this wouldn't matter, but we're not. The market is very nervous and very thin." [...]
The Fed lent cash and government bonds to banks, which gave the Fed collateral in the form of equities and debt, including subprime and structured securities such as collateralized debt obligations, according to the Fed web site. The borrowers have included the now-bankrupt Lehman Brothers Holdings Inc., Citigroup Inc. and JPMorgan Chase & Co.
Banks oppose any release of information because it might signal weakness and spur short-selling or a run by depositors, said Scott Talbott, senior vice president of government affairs for the Financial Services Roundtable, a Washington trade group.
"You have to balance the need for transparency with protecting the public interest," Talbott said. "Taxpayers have a right to know where their tax dollars are going, but one piece of information standing alone could undermine public confidence in the system." [...]
The Fed's collateral "absolutely should be made public," said Mark Cuban, an activist investor, the owner of the Dallas Mavericks professional basketball team and the creator of the Web site BailoutSleuth.com, which focuses on the secrecy shrouding the Fed's moves.
The shameless looting of the public treasury by George Bush and the banking industry continues unabated.

27 comments:

googleboy said...

Government Provides New Aid to A.I.G.

Curmudgeon said...

And in other news, DHL is shutting down its entire internal US delivery service. Approx 4500 to 5000 jobs lost. And Circuit City has filed for Chapter 11 bankruptcy, after announcing it was closing 20 percent of its stores, and laying off thousands of employees. It said it's looking for another 700 layoffs. And of course Mervyns is now running its "going out of business sale" ads.

And the beat goes on.... Sure glad the GOP provided us with a CEO president in Dubya. Can't imagine the mess we'd be in if we hadn't had his cool judgment and razor-sharp business sense to rely on for the last eight years....

Guns and Gold said...

"undermine public confidence in the system"

Yikes!

Is there anyone on earth who still has confidence in the U.S. financial system?

Does the the government's secrecy in these matters promote public confidence at all?

Put all your spare change into physical gold right now - if you can buy it at any price.

Having a couple of well-oiled autoloaders, and plenty of ammunition, might not be a bad idea in these perilous times, either.

Machster said...

"The market dropped from 14K to 8K well before the election. The notion that what's happening in the market now, all around the world, is the result of Obama's election is nonsense. The Market has been volatile.... four hundred plus point swings, mostly down... for many months now." Curm

"And the beat goes on.... Sure glad the GOP provided us with a CEO president in Dubya. Can't imagine the mess we'd be in if we hadn't had his cool judgment and razor-sharp business sense to rely on for the last eight years....Curm

Although a little late, the above posting by Curm is so much male bovine excrement, I can not stand it. And I think he might well know it too.

The stock market tries and has always tried to operate at 'six month to nine months' ahead schedule. The September and October and now November market collapse began in Bill Clinton's first term when he signed a bill passed by the democratic majority authorizing "Communities to guarantee housing loans to people would simply could not afford them". It was a noble, but as usual BAD IDEA, as was "Don't ask - don't tell", nationalized health care and many other liberal and democratic left agendas. Noble...with public appeal, but generally economically bad ideas.

The chickens came home to roost on the financial markets much later, thanks to the Clinton/Democrat agenda. And yes, it was never corrected by the Republicans or Clinton or "the Shrub", after the GOP mounted an election coup in '94. A plague on all their houses and shame on them.

Bottom line, the Market began seeing ahead to an Obama victory many - many months before September 08. That is what they do. And what they saw was a high probability of a Democratically controlled Congress and a Democrat in the Executive office. And while that might be considered ideal for social and "fairness" issues... for economic and business expansion and prosperity, unemployment/job creation, financial security, etc....well the market has and will continue to speak.

"EEJITS" (or the ill informed or ignorant)...will believe that the crush and crash we are seeing now was the result of the Bush administration. And they will very likely swallow the notion that the GOP caused all this mess. Hell, I even bought into it a little bit. But truth is simply the truth. Facts simply are... And all the spin and accusations and recriminations will be settled by non-partisan historians in the clarity of hindsight. So rest easy all you librocrats out there. I am one of you by the way.

And come Spring and/or Summer 09, there will be a lot of people on both sides left unhappy and upset. Traditionally, weak "leadership" will rely on scapegoating and focusing anger, distrust and disappointment upon an already unpopular figurehead...

So the pesimist and cynical see the Obama administration and media collaboration doing the standard "blame the previous administration" on everything they are either incapable or unwilling to "Change". This is nothing if not dishonest. And I for one hope I am wrong and Obama stands up to the Democratic "leadership" and says "NO", We are going to do things differently for a "Change". We are going to rise above traditional politics and focus instead on what is right without regard to what Pelosi and Reid and the others who surround him will try to sell. No focus groups, no what will get me reelected next term and no scapegoating. Let's just do what is right by America and by Americans.

Curm, please use your considerable mental clarity to see the truth as it is and do not try to continue with this standard line of scubala. "That it is all the Yale Cheerleader's fault". The issues facing our Country will require the best and brightest minds to focus on serious solutions and not on political talking points meaded out by those who would insult our collective intelligence. Those who try to lead by BS, caused by emotional over-ride on rational intellegent thought and careful consideration of the FACTS, versus blind "hysteria" and emotional brain tilt/farts.

Our future depends on some serious redirection and "change". And I for one, could care less if the left or right happens to be in office or power or gets any "credit" or "points". We are, dare I say it?, desperate for solutions and correct decisions based upon facts... not spin nor political BS.

PS Encouraged by the changes made in the Utah Legislature. But still concerned that we may be witnessing more of just manipulative crap from the same element in Utah culture under different names and personalities. More "spin" and PR" to mask the nauseaus corruption and graft, which is VERY real in SLC at the Capital building. A litmus test will be very serious ethics and campaign finance reform. Without quick and postiive action this session we will know the answer clearly. Don't ya think?

you can't be serious said...

Rudi, get a grip! if we don't spend billions bailing out thousands of failing America companies, we'll have a depression and we'll all be forced to ride around the country in railroad boxcars,looking for jobs, and being forced to listen on our ipods to music like this:

Great Depression Hits

ozboy said...

Mr. Curmudgeon

This one is for you, prompted by your statement on another thread about how happy you were to use the term "President Elect Obama"

One sunny day in 2009 an old man approached the White House from across Pennsylvania Avenue, where he'd been sitting on a park bench. He spoke to the U. S. Marine standing guard and said, "I would like to go in and meet with President Bush."

The Marine looked at the man and said, "Sir, Mr. Bush is no longer
president and no longer resides here." The old man said, "Okay"
and walked away.

The following day, the same man approached the White House and said to the same Marine, "I would like to go in and meet with President Bush."

The Marine again told the man, "Sir, as I said yesterday, Mr. Bush is no longer president and no longer resides here." The man thanked him and, again, just walked away.

The third day, the same man approached the White House and spoke to the very same U. S. Marine, saying, "I would like to go in and meet with President Bush."

The Marine, understandably agitated at this point, looked at the man and said, "Sir, this is the third day in a row you have been here asking to speak to Mr. Bush. I've told you already that Mr. Bush is no longer the president and no longer resides here. Don't you understand?"

The old man looked at the Marine and said, "Oh, I understand. I just
love hearing it."

The Marine snapped to attention, saluted, and said, "See you
tomorrow."

Jason said...

The Fed is transparent in that it is subject to the oversight of
Congress. Is twice a year not fast enough? The intent of Congress in
shaping the Federal Reserve Act was to keep politics out of monetary
policy. Legislation requires that the Federal Reserve reports annually
on its activities to the Speaker of the House of Representatives.

http://nomdeals.blogspot.com

Britney Spears said...

Honestly, I think we should just trust our president, treasury secretary and FED Chairman in every decision that they make and we should just support that.

danny said...

Before I destroy all credibility for myself, let me observe that in Britain, the Labor Party is in control, so they are the ones who are unpopular. Indeed, their Prime Minister Gordon Brown appears to be even more incompetent than our President Bush (who is certainly incompetent.) So I don't think Curm's broad strokes against Republicans really apply.

The Brits have put together these videos to satirize their leaders. Be warned the subtitles liberally use the f-word.

On the other hand, they are falling down funny.

Gordon Brown Downfall, the Prequel

Gordon Brown Downfall

If you'd rather skip the profanity, here is a similar videos on a current economic topic that is also funny.

Hitler, the real estate flipper.

RudiZink said...

"The Fed is transparent in that it is subject to the oversight of Congress. Is twice a year not fast enough?"

Once a week wouldn't be timely enough under present circumstances.

You're so full of crap, Jason, your eyeballs are leaking.

The Bush administration's looting of the public treasury continues.

Meanwhile, investors like yours truly can't properly invest their investment funds (and haven't been able to do so for over six months) according to economic principles, because the current market interventionist government won't tell us which of these corporate welfare case companies are solvent, and which are not. The normal roadsigns are changed by our now corporo-fascist government on at least a weekly basis.

I can only imagine what the difficulties must be for professionaal bond investment fund managers like Dan Fuss, vice chairman of Boston- based Loomis Sayles & Co., who's quoted above.

You right wing socialists have wrecked not only the markets, but the whole economy.

How many investors and prudent savers will have to go broke before the government finally "lays off?"

With all these taxpayer equity positions in all these broke companies, the USA looks like a Latin American Dictatorship at this point in history.

It's sad, very sad.

And I'm obviously mad as hell.

danny said...

Amen Rudi.

Real estate, the stock market, commodities have all crashed. All US car companies are bankrupt.

But as I have said, the real terror will begin when government bonds go down.

Read Here

How will the government accomplish the final ripoff of the public? The same way they always do.

Read Here

It's scary stuff if you can stand to read it. But it is the future.

RudiZink said...

Good stuff, Danny, as per usual.

Thanks!

danny said...

And remember the saying, "A bear market destroys bulls and bears alike."

PPK said...

machster:
Here's some valid reading you might like...dems might not dig on it so much tho. Makes too much sense.
OBAMA MUST FORSAKE CAP GAINS TAX HIKE TO STABILIZE MARKETS
I'll be surprised if this link is still here in 20 minutes tho.

Cris Cohen said...

I worry it all went to that Nigerian Prince I keep getting emails about.

Curmudgeon said...

Machster:

Just four quick points:

1. The notion that the market, with perfect foresight, anticipated an Obama election two months ago and that that explains its subsequent volatility implies that the market responds to single causes to an extent that cannot be sustained by the evidence. [I notice every day the market swings wildly, up or down, the market gurus offer another explanation for what happened. Jobs report, change in durable goods orders, etc. etc. etc. ]

2. It was, as I recall, the Republican Party that told us all eight years ago how wise it would be to put our first CEO, G.W. Bush, into the presidency, because it would bring professional business management to that office for the first time. That wasn't my claim, it was theirs. And yes, I'm enjoying a bit the delicious irony of reminding folks of that now and then.

3. Well, I'm a little old fashioned, M., good New Deal liberal and good Democrat that I am. I tend to think actions have consequences. And eight years into a president's term, he and others ought to be willing to agree that his actions, or lack thereof, have had significant consequences, which over time materially contributed to the mess we are now in. I find it kind of funny, actually, that eight years into a Bush presidency, for six of which he had a Republican congress bleating after his every command, that Republicans are still insisting the mess is largely Bill Clinton's fault, and that Bush's actions really didn't have much to do with things at all.

I'm still asking of Republicans when they will offer the rest of us a date certain beyond which they will no longer claim that whatever disaster is on going during a Republican presidency will not longer be attributed to Bill Clinton. 2050? 2100? 2500?

4. As for this... "Communities to guarantee housing loans to people would simply could not afford them". It was a noble, but as usual BAD IDEA, as was "Don't ask - don't tell", nationalized health care and many other liberal and democratic left agendas. Noble...with public appeal, but generally economically bad ideas. Well, M, of the top 25 sub prime mortgage granting institutions, only one... one... came under the bill you are talking about. And that bill did not require even the institutions that came under it [mortgage brokers did not] to make bad loans. In fact, it had lending standards built in to prevent the kind of sub-prime irresponsible lending that has put so many homes into foreclosure. [No interest only loans were made under the bills requirements for example. ] Which is why the loans that were made under the provisions of the law you are taking about have a lower foreclosure rate than loans not make under the terms of the act.

The notion that that bill pitched the nation over the edge into the sub prime mess is not sustainable on the evidence.

Machster said...

Nice try Curm, but your assertions are just incorrect and flat out wrong. We have to agree to disagree on this. For example; actions AND INACTIONS Both have consequences. And market guru explanations for the volatility... the guru's like to get their words actually published. Are you going to tell us that the major media did not conspire and participant in Obama mania? After the post election admissions for extreme bias toward Obama! And since you apparently missed it Curm, I say again, "The chickens came home to roost on the financial markets much later, thanks to the Clinton/Democrat agenda. And yes, it was never corrected by the Republicans or Clinton or "the Shrub", after the GOP mounted an election coup in '94. A plague on all their houses and shame on them." Machster

Congressional oversight from Barney Frank and Chris Dodd, both Democrats, Chair and Vice Chair of the Commission charged with oversight of Fannie Mae and Freddie Mac, failed miserably. You really want to stand up for these two clowns? Who appointed them?

Please try harder, Curm... ent al, to set rampant glouting aside and consider the facts of the serious situation we now face. Our Country needs honest and considered opinions now. The season of political sloganeering and male bovine excrement is over. Time to get down to serious mature adult analysis and honest consideration done with character and the dignity you possess.

Machster is trying to see both sides of the issues and not rely on either left or right side's "talking points". Guess that makes folks like him "independents". Might want to try it for a change, and stop with the unseemly chest beating.

Obama's chickens will come home to roost soon enough. He, from all appearances and past associations, has no experience, no character and no honest credentials for the highest office in the land. I pray I am as wrong about him as I was about the "Shrub". For our Country's sake.

See ya tomorrow at Karen's perhaps to watch the Veteran's Parade. Although with 20 years of servious, just can not get past the disrespect and dishonor heaped upon us Vietnam Vets as we returned home, mostly mourning super close friends who did not. I have forgiven the democrats, but I can not forget who sent us and then deserted us. I am not proud of the left's behavior in the 60's, and I can not say I am very proud of the decisions being made recently.

Am I alone in this? Where are the independents? Are any of you out there who would "lean against the ever harder left voices" on this blog to get things straigtened out or find the center and truth?

Minor Machman, I'll stand alone if I must.

ozboy said...

Mr. Curmudgeon and Mr. Machman

According to Oscar Levant

"The only difference between the Democrats and the Republicans is that the Democrats allow the poor to be corrupt too."

what will it cost us said...

AIG had a secret luxurious meeting for their executives in AZ that was exposed on the news. I hope these executives are sent to jail for federal fraud. How dare they say they need a bailout when they are spending taxpayers funds. These whores have no conscience and only want more free money until the whole country is broke.

These last few months of republician control should empty out the treasury, and our debts to Russia and China keep balloning. It will be interesting to see the real numbers that we owe since I think they have been hidden in executive privledge.

Paul said...

And when did all the jobs start going overseas? Seem to remember that being back in the Reagan years when the cry of "we must globalize" was predominant. Now, with no manufacturing, nothing to sell, we have a service based economy, which is likely more sensitive to downturns as it relies on more disposable income. Seems the Reagan admin and those that followed listened to "Money for Nothing" a bit too much. Now, the global market has dried up. We live in a finite world, with a finite number of consumers, finite resources, and finite jobs. It is not just the GOP's fault or the Dem's. It is all of our faults for allowing our government to let American companies leave our shores and not be penalized. For example, when Iomega moved all it's operations to Malaysia, it should have been required to move it's headquarters there as well. It should have been treated as a foreign coporation and it's incorporation in America dissolved. It's products should have been treated as foreign, and the company been treated as foreign. These companies, too many to list, should never have benefited from American tax laws that benefit American companies. Get it together people, standing on party lines is never going to resolve this problem. Getting those that are tainted out of Washington and replacing them with freshmen who have not been corrupted by the lobbyists is the only way we will get back on track. From Utah, Hatch has been there way too long, Bennett is no better. I realize that they are Republicans, but then,from Utah, who isn't. The whole Washington group has to be torn down and we must start over. The corrpution is too deep, and you and I are footing the bill.

Paul said...

Machman,

I believe our involvement in Vietnam began as advisors in the 50's, under Eishenhower & Nixon, when the French pulled out. Following that, I believe that Kennedy resisted combat troops being sent. Johnson's intent was to get in and win the "conflict", as war was never declared. The mismanagement of that war resulted in many losses and the lack of commitment of necessary resources caused us to lose and pull out in disgrace. You should have been given the support necessary to win. Sound familiar? I respect and support our veterans fully. What I don't support is a government that only half-assed commits. Our soldiers should only be used in combat under justifiable circumstances and only as a last resort. Presidents of both parties are equally guilty of the Vietnam fiasco.

Machster said...

Paul...just so ya know....you said:

"I believe our involvement in Vietnam began as advisors in the 50's, under Eishenhower & Nixon, when the French pulled out. Following that, I believe that Kennedy resisted combat troops being sent. Johnson's intent was to get in and win the "conflict", as war was never declared."

Between 1945 and 1954, the Vietnamese waged an anti-colonial war against France and received $2.6 billion in financial support from the United States. The French defeat at the Dien Bien Phu was followed by a peace conference in Geneva, in which Laos, Cambodia, and Vietnam received their independence and Vietnam was temporarily divided between an anti-Communist South and a Communist North. In 1956, South Vietnam, with American backing, refused to hold the unification elections. By 1958, Communist-led guerrillas known as the Viet Cong had begun to battle the South Vietnamese government.

To support the South’s government, the United States sent in 2,000 military advisors, a number that grew to 16,300 in 1963. The military condition deteriorated, and by 1963 South Vietnam had lost the fertile Mekong Delta to the Vietcong. In 1965, Johnson escalated the war, commencing air strikes on North Vietnam and committing ground forces, which numbered 536,000 in 1968. The 1968 Tet Offensive by the North Vietnamese turned many Americans against the war. The next president, Richard Nixon, advocated Vietnamization, withdrawing American troops and giving South Vietnam greater responsibility for fighting the war. His attempt to slow the flow of North Vietnamese soldiers and supplies into South Vietnam by sending American forces to destroy Communist supply bases in Cambodia in 1970 in violation of Cambodian neutrality provoked antiwar protests on the nation’s college campuses.

Eisenhower and VP Nixon sent money/aid. In 1958-59 the decision was made to send advisors and 2,000, mostly technical advisors, were sent. Under Kennedy (elected in 1960) the number grew to 16,300 troops in `1963. So Paul, if Kennedy resisted sending troops into Vietnam...well that is revisionist histroy and "spin" from the left. Under Johnson, more than a half million of us were drafted and sent in the "pipeline" to SEA by 1968. Every year troops from all services were rotated in and out which means MILLIONS of troops were sent and served in that hell hole. Lest anyone misunderstand the nature of the personnel system and the correct impacts on the troops and their families. More than 58,000 died believing that our Country was good enough to serve and die for, even if the left and liberal nut cases disagreed. burned draft cards, demonstrated enmass, and grossly misrepresented just about everything they had to say on the matter. Truth is they were bonded by the desire to find an excuse for cowardice. Honest and patriotic draft elegible youth simply declared themselves conscientous objectors...something our political system has honored since WWI.

Because people like Ramsey Clark, Jane Fonda, the Chicago 10, leaders of the Winter Soldier's Investigation farse in Detriot, and yes... John Kerry, were not prosecuted for treason left our Country forever divided. Jimmy Carter and his amnesty over-reaching tapped Sec. of the Navy, John Lehmann, for example, and had him purge Kerry's official Naval Personnel file. So much was done which should have been allowed to run through a time proven legal process, we will likely never fully recover from it. Even if the likes of Clark, Fonda, Kerry, and the others had been exonerated, at least the Country would have learned something about what constitutes treason and what is not.

Let's not refight that ugly time in our history, but let's not bull-shit one another either. Especially today.

Paul said...

Machman

Not trying to fight shit. Did I not say you needed everything you needed to win the war? Did I not inessence say it was a clusterf..k on both parties parts. Not trying to argue who the f..k got us into the damn thing. I F..CKING agree with you. Did it screw with your head so bad you can't see support, even if the history has been learned in classes. No I didn't live the shit you did. But the government is the bad guy in the matter. So don't bullshit me either. Take the support or FOAD.

Machster said...

Paul,

Nice, very nice. Thank you for your gentlemanly support and eloquent argument on behalf of the Vietnam vets.

Machster

Crimmony said...

Gees...Paul,

Take some lithium or a prosac or something!

Machman was only pointing out that you were right, except the part about Kennedy and troops between '60-63. If that pops your historic bubble, tough! "Figures don't lie but liers will figure." Machster's figures came from the historic record in the library of congress.

And then Machster shared his own thoughts and opinions about what really went down during those times, since he personally experienced it. Something us bloggers should appreciate, not act like an ass over.

Thanks Machman, for telling it like it was. Or at least the way you saw it. I apologise for Paul and any other apparent nut jobs on this blog. They should not act like asses with thin skin, but should read and learn, consider and then add constructively, or at least humor, to the blog. His comments were stupid and in very bad taste.

Crimmony

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