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I want to be converted into a bank. FREE MONEY!

May 28, 2011

Any private institution deemed so critical that its failure would bring down the entire economy should either be broken up, regulated as a utility or entirely nationalized.
Banks that are in poor fiscal health are unable to lend. Businesses and consumers need to borrow to expand their enterprise and spend spend spend. DEBT DEBT DEBT. So a healthy financial sector is critical for a health economy. If you are deemed critical to the economy then the Federal govt will pull out all the stops to ensure your profitability.
In 2008 banks found it difficult to borrow to cover their liabilities and as such were on the brink of insolvency. The great thing about being a bank is you dont have to borrow at market rates when you can borrow from the Fed discount window. So if the overnight lending rate is 5% – no problem as the Fed discount rate is .5%. Yep, .5%.
So banks borrow at .5% and lend right back to the govt at 2%. (2yr treasury)
Easy money. The old adage is 3-6-3. Banks borrow from savers (savings account) at 3% – lend it out at 6% and on the tee by 3pm. Now they borrow from the fed at .5% – lend it back to the Govt at 2% and hit the tee by 3.
BUT… it gets better. The Fed’S teat wasnt nursing the banks back to health fast enough so Ben Bernanke decided to give the banks free money. He secretly lent to banks (and investment banks) at 0% int…

Ok ok, it wasnt 0% – it was .01%.

.01%…………………… THATS FREE MONEY

“New York-based Goldman Sachs’s borrowing peaked at about $30 billion”

The same Goldman sachs that swore up and down that they didnt need any bail out money? The same Goldman who made billions shorting the mortgage market? The most profitable investment bank in the history of time ? Who paid out billions and billions in bonuses the same year they borrowed billions and billions from the govt for nothing ?

HOW ARE PEOPLE NOT FREAKING THE FUCK OUT?!??!??!??

WHERE IS MY FREE MONEY?
WHERE IS MY FREE MONEY?
I WANT FREE MONEY!!!!!!
TARP WAS 5% !! THIS WAS FREE MONEY!

http://www.businessweek.com/news/2011-05-26/fed-gave-banks-crisis-gains-on-secretive-loans-as-low-as-0-01-.html

http://www.bloomberg.com/news/2011-04-01/foreign-banks-tapped-fed-s-lifeline-most-as-bernanke-kept-borrowers-secret.html

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2 Comments leave one →
  1. A. Strung permalink
    May 30, 2011 10:40 am

    Great stuff yet again!

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