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Zero Hedge – Federal Reserve Loses $2.4 Billion In Taxpayer Money In Most Recent QE2 POMO Interval
Fron Zero Hedge:
Record Social Inequality And Its Violent Aftermath, Explained By A Three Minute Cartoon
CLSA’ Chris Wood On Why Chinese Inflation Is Not That Big Of A Deal, And Other Issues
China Is Overheating… Again: CPI And PPI Both Come Much Higher Than Expectations
Guest Post: The Bond Bust Has Begun
CFTC Weekly Update: FX Revulsion Continues As Bearish Bond Sentiment Moderates
Second QE2 POMO Schedule Released: Fed Will Buy Back $105 Billion In Bonds Through January 11
Federal Reserve Loses $2.4 Billion In Taxpayer Money In Most Recent QE2 POMO Interval
Submitted by Tyler Durden on 12/10/2010
With the Federal Reserve now actively participating in capital markets, it should be noted that just like every other asset manager, the Fed has to be held accountable for its trading efficacy. After all, the Treasury takes every opportunity to remind the US public how courtesy of record amounts of new government debt, it has managed to make “profits” on its assorted investments, which are merely transfers of risk from one entity to another, and the “another” being the US taxpayer, although not directly, but indirectly via the now ludicrous amount of US debt which will never be repaid. Which is why the US taxpayer may want to know that in just the most recent POMO schedule – that from early November to December – the Federal Reserve has lost $2.4 billion in taxpayer capital by its mistimed market operations, primarily due to the recent rise in interest rates. This is $2.4 billion that has not evaporated, but instead has been transferred to Primary Dealers under the “profit on trade” category. This is also money that will be used to determine, and fund, banker bonuses.
Washington’s Blog – Does Bernanke Look Like a Man Who is Confident About the State of the Economy and the Prospects for Recovery?
From Washington’s Blog:
There is a lot to say about Bernanke’s comments on 60 Minutes today.
Bernanke’s statement that unemployment is the biggest impediment to economic recovery is ironic, given that Bernanke’s policies have increased unemployment. See this and this.
Harry Blodget notes that Bernanke implied that inequality is destroying America. Tyler Durden hones in on Bernanke’s statements that the economic recovery may not be self-sustaining, and that the Fed may buy even more bonds. Daily Bail picks on Bernanke’s claim that the Fed is not printing money.
There are certainly a lot of interesting things to say about Bernanke’s words.
But I think the real story is how nervous Bernanke appears.
Listen to his voice, and watch his lips quaver:
Ignore his words … does this look like a man who is confident about the state of the economy and the prospects for recovery?
Does this sound like a man who is sure that history will judge his actions kindly?
Senator Bernie Sanders – A Real Jaw Dropper at the Federal Reserve
From The Huffington Post:
A Real Jaw Dropper at the Federal Reserve
By Senator Bernie Sanders (I-Vt.)
At a Senate Budget Committee hearing in 2009, I asked Fed Chairman Ben Bernanke to tell the American people the names of the financial institutions that received an unprecedented backdoor bailout from the Federal Reserve, how much they received, and the exact terms of this assistance. He refused. A year and a half later, as a result of an amendment that I was able to include in the Wall Street reform bill, we have begun to lift the veil of secrecy at the Fed, and the American people now have this information.
It is unfortunate that it took this long, and it is a shame that the biggest banks in America and Mr. Bernanke fought to keep this secret from the American public every step of the way. But, the details on this bailout are now on the Federal Reserve’s website, and this is a major victory for the American taxpayer and for transparency in government.
Nomi Prins – Ten Reasons We’d Be Better off Without Ben Bernanke
From AlterNet:
Ten Reasons We’d Be Better off Without Ben Bernanke
By Nomi Prins
The Federal Reserve chief has recklessly bailed out our financial system — we shouldn’t wait the 10 years before his term expires to toss him overboard.
December 1, 2010On Wednesday, the Fed disclosed its highly anticipated report about which banks got the most perks during the Great Bank Bailout and Subsidization period. Long story short, the report, spanning 21,000 transactions from December 2007 to July 2010, did not reveal which banks borrowed what from the Fed’s discount window (the part we wanted to know), but confirmed that the biggest banks got the most help from various facilities (the part we already knew). The report is parceled out through a maze of different pages and spreadsheets for inconvenient viewing. But hey – the future of the free world was at stake, the Fed did what it had to do, and things would have been much so worse without fearless Ben, Tim and the boys intervening with trillions of manufactured dollars. Now, Bernanke will breathe a sigh of relief.
Why? Because there will be nothing else for him to weather. That is, until the true ramifications of the reckless banking system subsidization and securities inflation manifests in a broader, scarier version than last time.
Here are ten reasons this dire economic fate is likely, and we’d be better off getting rid of Bernanke long before his term ends in 2020.
1) The Banks Bernanke Made Bigger are Still Bigger
Tyler Durden – Guest Post: The Federal Reserve And The Pathology of Power
From Zero Hedge:
Guest Post: The Federal Reserve And The Pathology of Power
Submitted by Tyler Durden on 11/18/2010 10:50 -0500
The Federal Reserve is an example not just of run-of-the-mill hubris but of the far more profound Pathology of Power. The rule of law has been supplanted in the U.S. by self-serving propaganda campaigns serving State and financial Elites: this is the Pathology of Power. The Federal Reserve is an instructive example because it is so blatant. Despite the dearth of evidence that goosing the stock market actually generates a “wealth effect” which “trickles down” from the top 10% who own the vast majority of equities to the bottom 90%, the Fed has waged a ceaseless propaganda campaign claiming this policy goal is now essential for the nation’s well-being. No mention of its positive effect on Wall Street; cui bono (to whose benefit?) indeed.
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