foreign banks

Audit of the Federal Reserve finds massive bailouts

Congress pushed for an audit of the Federal Reserve.  They wanted to know what was going on behind closed doors.  The Fed wasn’t crazy about that, but the lost on that one.  The result?  Well, how about over $16 trillion in bailouts that the American public didn’t know a damned thing about for starters?

That’s right folks, $16 trillion was “loaned” out at 0% interest to corporations and national banks throughout the world.  It hasn’t been paid back.  So what’s the big deal?  Here’s an analysis of what we’re talking about:

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, and swallow this Red pill: There was no debate about whether $16,000,000,000,000 would be given to failing banks and failing corporations around the world.

Keep in mind that the Federal Reserve isn’t exactly a private bank.  It’s a semi-private bank that’s in charge of massive amounts of the United States economy.  In addition to acting as a bank, loaning money to other banks that permits them to loan it to us, it also lists the following as among it’s function.

The Federal Reserve has responsibility for supervising and regulating the following segments of the banking industry to ensure safe and sound banking practices and compliance with banking laws:

Herman Cain flip-flops on Federal Reserve audit

While filling in on The Neal Boortz Show on December 29th, Herman Cain launched into a rant defending Federal Reserve and downplaying efforts for an audit. His point was that the Federal Reserve wasn’t doing anything secret, to his knowledge, and that the movement for an audit amounted to nothing more than a lack of understanding as to how the nation’s central bank operates.

Here is a transcript of Cain’s remarks:

[T]he Federal Reserve already has so many audits, it’s ridiculous. I don’t know why people think we’re gonna learn this great amount of information by auditing the Federal Reserve. Now, I no longer serve on the board of the Federal Reserve. I’m not being defensive of the Federal Reserve; in fact, some of the policies and some of the actions of the Federal Reserve, I don’t agree with because the attitude and the non-politization in the 90’s when I served is totally different than what’s going on today. But that’s another matter.

But people who say, “we outta audit the Federal Reserve because we don’t know enough about it.” Well, here’s the advice I’ve given to people who ared worried about an audit of the Federal Reserve; call ‘em up, and ask ‘em if you can stop by and have one of their PR people or one of their Public Relations people explain to you how the Federal Reserve operates.

I think a lot people are calling for this audit fo the Federal Reserve because they don’t know enough about it. There’s no secrets going on in the Federal Reserve, to my knowledge. And I tell people, we’ve got 12 Federal Reserve banks, find out which district you’re in, call ‘em up and go from there.

We don’t need to waste money with another commission, or an audit that’s not necessary, because, folks, we’ve gotta lot of other problems we need to worry about.

US to bailout Europe

Yesterday it was announced that the United States would send more money to Europe via the International Monetary Fund to bailout faltering economies, such as Ireland:

The United States would be ready to support the extension of the European Financial Stability Facility via an extra commitment of money from the International Monetary Fund, a U.S. official told Reuters on Wednesday.

“There are a lot of people talking about that. I think the European Commission has talked about that,” said the U.S. official, commenting on enlarging the 750 billion euro ($980 billion) EU/IMF European stability fund. “It is up to the Europeans. We will certainly support using the IMF in these circumstances.”

“There are obviously some severe market problems,” said the official, speaking on condition of anonymity. “In May, it was Greece. This is Ireland and Portugal. If there is contagion that’s a huge problem for the global economy.”
[…]
The developments have echoes of the pressure applied by Washington on European capitals last May to create the near $1 trillion EFSF safety net that was last week used to rescue Ireland after its banking crisis spiraled out of control.

The IMF, whose biggest single shareholder is the United States, has committed 250 billion euros to the EFSF.

While reluctant to dictate to Europe how it should address the unfolding debt crisis, the U.S. government is growing concerned about the global fallout of Europe’s predicament.

In addition to American taxpayers funding this European bailout, the Federal Reserve finally released details on loans it made to banks, and the list includes foreign financial institutions:


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