Posted on 05/29/2012 8:23:35 AM PDT by Lorianne
Little noticed is that on Tuesday Team Obama took its first formal steps toward putting taxpayers behind Wall Street derivatives trading—not behind banks that might make mistakes in derivatives markets, but behind the trading itself. Yes, the same crew that rails against the dangers of derivatives is quietly positioning these financial instruments directly above the taxpayer safety net.
Specifically, the law authorizes the Federal Reserve to provide "discount and borrowing privileges" to clearinghouses in emergencies. Traditionally the ability to borrow from the Fed's discount window was reserved for banks, but the new law made clear that a clearinghouse receiving assistance was not required to "be or become a bank or bank holding company." To get help, they only needed to be deemed "systemically important" by the new Financial Stability Oversight Council chaired by the Treasury Secretary.
(Excerpt) Read more at online.wsj.com ...
US to Backstop the Anglo-American Derivatives Exchanges with Fed Dollars - ‘Too Big To Fail’
http://jessescrossroadscafe.blogspot.com/2012/05/us-decides-to-backstop-anglo-american.html
Lampost and rope time coming up...
This is nuts.
Doesn’t this fall into the category of “monetizing the debt?”
I’ll hang up and listen to the response....while re-checking the duck-tape
I fear crapola like this is eventually going to cause the electorate to SO turn on Capitalism.
When the American Hitler or Stalin gets himself elected it will be due to moves like this.
Not to worry -
We tapxayers have swell guys like Geithner Bernanke and Barney Frank protecting our interests
BTW, WTH are the Republicans on this?
Law? Did congress pass something while we weren’t looking? Or is this one of those executive orders?
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