I posted this recently about Wall Street being embarrased and humiliated by Obama and the Democrats and wondered why Wall Street is taking all of this heat sitting down and without even a wimper?
Goldman Sachs even said that this is good legislation- why don’t we take a look at an example of how this bill will benefit those involved. Understanding the Fed and the role it plays with big boy banks like Goldman Sachs is complicated.
Example: The Fed’s discount window is opened to the big boy banks for loans. Big boy bank comes to the window and borrows $80 Billion dollars at .50 basis points or 1/2 of 1%. In this bill, coursing its way through Congress, demands these “big boy banks“ lend the $80 billion dollars to the government to help cover its deficit spending. The government agrees to pay the banks 2 1/2% for the duration of the loan life. After 1 year, the bank will pay back $400 million dollars in interest to the Discount Window and will bring $1.6 billion dollars to their bottom line just from interest the government pays the big boys to service this loan. Of course being a taxpayer, our tax money will go to service this $2 billion worth of interest.
Is it any wonder why the liberals think the American people are stupid. If Americans are given the information, the trickery, the con jobs, the smoke and mirrors, and are allowed to “follow the money,” then it does not take an Einstein to understand why the banks are taking this beating like a rented mule.
This is easy money, guaranteed by the good faith and credit of the United States government (taxpayers) and because the “big boys” are so big they can borrow what ever the governement needs to make up for its deficit spending without putting up one thin dime of collateral thus limiting their exposure.
Do you see what is happening to our country? Our debt bomb is showing signs of exploiding. Greece and possibly Spain are on the financial rocks of collapse which could cause a domino effect in the world financial system. The Chinese have openly said they would like to diversify and hedge their bets against the United States by purchasing metals and other financial instruments that they deem as more “safe” and “secure”than what they are holding from the US presently.
The government is getting into bed even more with the “big boy banks” so they can borrow more money from US banks. The US Banks are being used as a conduit for the channeling of money to the Federal government. When the government gets first dibs on money within our system then that will be that much more money that the private sector can’t access.
With China in the game the “real” money came directly from China. With China purchasing less and less of our debt then we have to print more money for servicing debt. This is called monetizing the debt, which will eventually lead to catastrophic financial failure and inflation that knows no limit.
Is there anyone in Washington that is elected that has the onions to stand up and tell the truth to the American people? Ultimately it is the taxpayers that are being manipulated for these ill gotten gains.
Related posts: