Skip to comments.Audit of the Federal Reserve Reveals $16 Trillion in Secret Bailouts
Posted on 09/03/2012 6:14:52 AM PDT by opentalk
The first ever GAO (Government Accountability Office) audit of the Federal Reserve was carried out in the past few months due to the Ron Paul, Alan Grayson Amendment to the Dodd-Frank bill, which passed last year.
Jim DeMint, a Republican Senator, and Bernie Sanders, an independent Senator, led the charge for a Federal Reserve audit in the Senate, but watered down the original language of the house bill(HR1207), so that a complete audit would not be carried out.
...Nevertheless, the results of the first audit in the Federal Reserves nearly 100 year history were posted on Senator Sanders webpage earlier this morning.
What was revealed in the audit was startling: $16,000,000,000,000.00 had been secretly given out to US banks and corporations and foreign banks everywhere from France to Scotland. From the period between December 2007 and June 2010, the Federal Reserve had secretly bailed out many of the worlds banks, corporations, and governments. The Federal Reserve likes to refer to these secret bailouts as an all-inclusive loan program, but virtually none of the money has been returned and it was loaned out at 0% interest.
Why the Federal Reserve had never been public about this or even informed the United States Congress about the $16 trillion dollar bailout is obvious the American public would have been outraged to find out that the Federal Reserve bailed out foreign banks while Americans were struggling to find jobs.
To place $16 trillion into perspective, remember that GDP of the United States is only $14.12 trillion. The entire national debt of the United States government spanning its 200+ year history is only $14.5 trillion.
The budget that is being debated so heavily in Congress and the Senate is only $3.5 trillion. Take all of the outrage and debate over the $1.5 trillion deficit into consideration,....
Here’s the actual GAO report.
After having seized every bit of their assets to pay this down.
When the hell are we going to wake up and hold them accountable?
The only way out of this is through a global collapse.
I personally would like to get through the tough times now so I can have a chance at seeing a brighter future in my old age.
$16 trillion does not seem possible. Somebody (lots of somebodies) have nice Swiss account by now and/or huge slush funds.
What it looks like to me is that these loans were actually IOUs given on the promise that generations of Americans will pay them off.
If that is even remotely true, our taxes can never ever go down because we’ll be forever paying off a debt that was created for no other reason than to create profit.
I recall being just a bit pi$$ed off back in '08 when, if I recall correctly, Bernanke received money with no questions asked to be used however he deemed fit without having to answer to anyone as to how is would be used.
We ALL knew what this would lead to and that it wouldn't fix a damn thing back then!
These people are outright criminals. This report should result in Congressional hearings and a decision to end the Federal Reserve. However, I am not holding my breath. There will crickets heard in Congress and nary a mention in the press. It’s only 16 trillion dollars secretly guaranteed by the US tax payer. That’s not important. What’s really important is that Rush Limbaugh said we should not have to pay for Sandra Fluke’s whoopie time-related health care expenses.
The list of institutions that received the most money from the Federal Reserve can be found on page 131of the GAO Audit and are as follows..
Citigroup: $2.5 trillion ($2,500,000,000,000)
Morgan Stanley: $2.04 trillion ($2,040,000,000,000)
Merrill Lynch: $1.949 trillion ($1,949,000,000,000)
Bank of America: $1.344 trillion ($1,344,000,000,000)
Barclays PLC (United Kingdom): $868 billion ($868,000,000,000)
Bear Sterns: $853 billion ($853,000,000,000)
Goldman Sachs: $814 billion ($814,000,000,000)
Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)
JP Morgan Chase: $391 billion ($391,000,000,000)
Deutsche Bank (Germany): $354 billion ($354,000,000,000)
UBS (Switzerland): $287 billion ($287,000,000,000)
Credit Suisse (Switzerland): $262 billion ($262,000,000,000)
Lehman Brothers: $183 billion ($183,000,000,000)
Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)
BNP Paribas (France): $175 billion ($175,000,000,000)
and many many more including banks in Belgium of all places
Not possible without ZIRP, which itself has us on a path to capital dislocation.
the optometrist office that my doctor retired from and a new philipino doctor took over received $20 million dollars because a minority physician tookover the business, American doctors need not apply.
VAN SUSTEREN, FOX News: People think of him as hawkish on the budget, on expenses, but he voted for TARP. He voted for the auto bailout, voted for two stimulus in ‘08, voted against the ‘09 — February ‘09 President Obama stimulus. How does — I mean, how does he explain those, or I mean, how does — politically, how does he sell that?
BOEHNER: I mean, I think that he's a practical conservative. He's got a very conservative voting record, but he's not a knuckle-dragger, all right? He understood that TARP, while none of us wanted to do it, if we were going to save — save our economy, save the world economy, it had to happen. I wish we didn't have to do it, either, but he understood that.
We have gone from ‘compassionate conservatives’ to ‘practical conservatives’ I cannot wait to see what they have in store for US next.
I don’t see USAA on that list.
I didn’t expect to see it there.
The Fedtards that troll blogs to counter the 16 T theft claim that they were just overnight loans that were made over the course of a few years and that were paid back the next day, but apparently that is not the case. You have to hypothecate a lot of American lives, property and labor to pay off a credit card like that.
I say that because I want a better world for my unborn grandchildren.
” I place economy among the first and most important virtues and public debt as the great danger to be feared. To preserve our independence, we must not let our leaders load us with perpetual debt. We must make our choice between economy and liberty, or profusion and servitude.” Thomas Jefferson
The report was issued in July 2011. It is not new.
the first act of the Marxists, who were surreptitiously infiltrated into key positions in our government in 1933, was to depreciate the dollar and deny to the American people the right of redemption because these conspirators had learned from Karl Marx that the surest way to overturn the social order was to debauch the currency. John T. Wood, “ American Mercury “
and the devastating presidency of Woodrow Wilson still wrecking havoc.....( The Federal Reserve Act 1913 ).
Your right, sorry this was from 2011...seemed to receive little coverage
That is not how the dollar swap arrangement works. From the report:
"Concurrent with the announcement of TAF, the FOMC announced the establishment of dollar swap arrangements with two foreign central banksto address similar disruptions in dollar funding markets abroad. In a typical swap line transaction, FRBNY exchanged dollars for the foreign central banks currency at the prevailing exchange rate, and the foreign central bank agreed to buy back its currency (to unwind the exchange) at this same exchange rate at an agreed upon future date (for a more detailed explanation, see app. IX).
The market for interbank funding in U.S. dollars is global, and many foreign banks hold U.S.-dollar-denominated assets and fund these assets by borrowing in U.S. dollars. In contrast to U.S. commercial banks, foreign banks did not hold significant U.S.-dollar deposits, and as a result, dollar funding disruptions were particularly acute for many foreign banks during the recent crisis. In December 2007, the European Central Bank and Swiss National Bank requested dollar swap arrangements with the Federal Reserve System to increase their ability to provide U.S. dollar loans to banks in their jurisdictions.
Federal Reserve Board staff memoranda recommending that the FOMC approve these swap arrangements noted that continuing tension in dollar funding markets abroad could further exacerbatetensions in U.S. funding markets.
On December 6, 2007, the FOMC approved requests from the European Central Bank and Swiss National Bank and authorized FRBNY to establish temporary swap lines under section 14 of the Federal Reserve Act. During 2008, the FOMC approved temporary swap lines with 12 other foreign central banks.
FRBNYs swap lines with the 14 central banks closed on February 1, 2010. In May 2010, to address the re-emergence of strains in dollar funding markets, FRBNY reopened swap lines with the Bank of Canada,the Bank of England, the European Central Bank, the Bank of Japan, andthe Swiss National Bank through January 2011. On December 21, 2010,the FOMC announced an extension of these lines through August 1,2011. On June 29, 2011, the Federal Reserve Board announced an extension of these swap lines through August 1, 2012.
Why has this been hidden from us for over a year??? Why have Rush, Hannity, Levin, et al not brought this up and made an issue out of it???
Including our King Bozo Oleomargerine.
Makes one wonder what the Occupy Wall Street movement was really all about and who financed it.
wow I wonder if this has anything to do with the fact that the federal reserve 100 year charter is about to expire...
What are they going to replace it with??
An institutionalized, generational debt [indistinguishable from slavery] like that? Wars have been fought for less, and [IMO] it seems like justification for one now.
There was a bible-verse that was really striking that I read a while ago, about parents stealing from children and how it was really wrong. Not to mention that America hasn't been about selling one's descendants into slavery (America was always individualistic, until very recently).
They sold our souls to the company store.
The [somewhat cynical] question that comes to my mind:
“How many of our fellow men would condemn someone who fought for the lives and freedom of his children by killing those who would “
I wonder how much of this is being used to keep a bid under Treasuries? It would seem to explain some of the supply/demand issues with Treasury prices.
“The report was issued in July 2011. It is not new.”
So, I guess it’s okay then.
Really gotta wonder what happens when the master decides to downsize his slave crew.
Aye; that won’t be pretty.
Old news isn't startling unless it is new news to you, I guess. I wonder why Sanders just posted it today--the day before the Dem convention?
These are overnight loans from the feds, so let's say citibank borrows 10 billion one night, pay it back the next morning, then borrow it again the next day, this goes on for 2 business weeks. How much was actually lent? This site is claiming the loan was $100 billion when really it was just $10 billion at risk to the government.
OK, that accounts for $20 million of the $16 trillion. Did 799,999 more optometrists open offices or where did the rest of the money go?
Actually 20 Billion. They had Citibank on there for $2.5 Trillion in loans. They probably have an average of $10 billion a day for 250 days. There were other big banks that had similar large numbers. No bank has any where near the numbers in that report.
USAA is underwritten/financed by the Bank of China. Maybe that is the reason;)
I hadn’t heard that. Can you substantiate that claim? Do you have a reference, for example?
I see no one countered your specificity, kabar.
So the question is [I guess], how much loan money was defaulted? And I’m asking around: does the Fed get freshly printed currency? Or is it involved in quantitative easing?
Part of kabar’s post 24:
“Concurrent with the announcement of TAF, the FOMC announced the establishment of dollar swap arrangements with two foreign central banksto address similar disruptions in dollar funding markets abroad. In a typical swap line transaction, FRBNY exchanged dollars for the foreign central banks currency at the prevailing exchange rate, and the foreign central bank agreed to buy back its currency (to unwind the exchange) at this same exchange rate at an agreed upon future date (for a more detailed explanation, see app. IX).”
There were no losses by the Fed given the swap arrangements. They just hold the foreign currency and can exchange it back at the fixed rate it provided the dollars.
“No bank has any where near the numbers in that report.”
I read that in an earlier thread. I do notice that critics of the 16 trillion threads tend to offer more specifics, not that I understand them.
That’s the problem. People who understand the Fed have a lexicon beyond tpyical comprehension, although typical people are that much more suspicious.
OK, thank you for your quick response! Right, so there could be devaluation, but nothing like Weimar Republic deval [I hope]. Is this a kind of ‘lifeline’ contingency to replace a degraded currency with US dollars?
No devaluation in terms of currency rate changes. That rate is fixed at the same rate as the date of the transaction. Eventually, the borrowing country will buy back its own currency using dollars. Much of it has already been purchased back by the borrowing countries.
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