Banks "quietly" borrow $50 billion from Fed: report

[UpInArms]

Source: Reuters

NEW YORK (Reuters) - Banks in the United States have been quietly borrowing "massive amounts" from the U.S. Federal Reserve in recent weeks, using a new measure the Fed introduced two months ago to help ease the credit crunch, according to a report on the web site of The Financial Times.

The newspaper said the use of the Fed's Term Auction Facility (TAF), which allows banks to borrow at relatively attractive rates against a wide range of their assets, saw borrowing of nearly $50 billion of one-month funds from the Fed by mid-February.

Read more: http://www.reuters.com/article/bondsNews/idUSN1821384420080219

---

is this an under the wire bailout?

[Yael]

1. Has LT check kiting commenced?

[zonkers]

58. LT? What do you mean?

[Qutzupalotl]

2. It's coming from the same place our stimulus checks are coming from.

Thin air.

[CatholicEdHead]

5. More like overseas loans, with intrest of course

[Lasher]

13. No, thin air is just as likely

'Thin air' would also be known as 'printing money'.

Deutschmarks, anyone?

[gratuitous]

3. That's very nice

Meanwhile, the check I bounced by $0.25 back in 1987 continues to appear on my credit report, requiring an elaborate explanation and sweating some pencil-necked green-visored schmo's decision whether to approve my measly loan application. But the banks can get $50 billion guaranteed by my taxes just on their good looks alone. That's just swell.

[Amonester]

6. we're just "expendable proles" to these corpo-communists, u no.

never mind that those of us, and our grand-kids, who will be lucky enuf to survive their crash will have to pay their debts plus interests for decades...

[closeupready]

44. "corpo-communists" - you nailed it.

n/t

[kineneb]

49. mmm, corpo-communists. crunchy, but good, with catsup.

and perhaps a bit of pickle relish.
want fries?

have feathers and pitchfork, need tar.

[Hissyspit]

12. Steal big. n/t

[bluesmail]

23. kick and reccomend

Steal Big That's yesterdays advice.

[RUMMYisFROSTED]

41. In 2008 dollars that's about $0.40.

You should be thankful you're not in prison. :grr:

[Systematic Chaos]

4. And off to the Greatest Page with ye!

:kick:

[whistle]

7. All this stimulus money that Bush has shoved into the monetary supply chain

...is nothing but bailout money for the speculators and hedge fund gamblers. It is hyper inflationary and almost none of it is filtering down to the people who really need it Ito save their homes

[jaybeat]

8. Yup. Bail out the crooks.

And stick us with the bill.

Business as usual.

[Baby Snooks]

9. How much have they borrowed?

Has anyone kept track of how much the Fed has "infused" into the banking system since the meltdown started? Just what are the banks doing with all the money? Who is borrowing from them? Or are they just merely borrowing for themselves to cook their own books finally after a decade of allowing companies like Enron to keep borrowing to cook their books with? Are the banks even solvent at this point? Apparently between the disaster of 2001 and this current disaster, the world equity markets have lost over $15 trillion in asset value. That's a lot of money that suddenly just isn't there. Money that people as well as corporations borrowed against. Sounds like the Bushes brought us "voodoo economics" after all. And all eyes turn to Alan Greenspan.

[Karenina]

40. Are the banks even solvent at this point?

:rofl::rofl::rofl::rofl::rofl::rofl:

[kineneb]

50. uhh, no...not really.

we just have not noticed they are dead yet...

[Yavin4]

56. It's A Dead Parrot

Ah, we can learn a lot from Monty Python.

[kineneb]

64. Bring out 'cher dead! Bring out 'cher dead!

"But I'm not dead yet."
Bonk

[Karenina]

60. But there's this nasty smell wafting our way...

:hide:

[Diclotican]

10. UpInArms

UpInArms

Isn't this, 50 billion US dollar something United States of America have to repay some times down the road... I know if I borrow something in the bank, I have to repay it, with interest... And the principe is the same, if you are a person, or you are a State..?

And I doubt that they who are given US the money are doing that just to be nice.. It is because United States have to repay it.. And the time when the king could say to the creditors "sorry cant repay you" when the Treasury was without money is over... US may get a invitation to the office of IMF soon, to explain how the money are used and to make a deal to how United States want to repay your astronomy debt... This 50 billion are coming on the top of the other debt aren't it?

Diclotican

Sorry my bad English, not my native language

[ret5hd]

16. ALL fiat money is debt...our money, your money, those people over there's money.

If all debt was paid, there would be no money in circulation.

[tavalon]

17. English is a weird language. American English, even more so.

Nonetheless, you made yourself perfectly clear and you are correct. Too bad that most of our population has no fucking clue what our government is doing. I'm surprised anyone in the world is still willing to loan money to United States. I wouldn't think we'd be a good credit risk.

That said, we will likely be destroyed by this insane borrowing. It will be the end of the American Empire (all Empires must end eventually) but I'm afraid this giant beast of a country will take the rest of the world down with her as she dies. That is really sad. At least Americans are kind of owed a spanking for our bad behavior. I don't think it's fair that the rest of the world has to be punished at the same time.

I'm really sorry Diclotican. I didn't personally ask my government to rob the world but neither was I able to stop it.

[Diclotican]

36. tavalon

tavalon

The English language are indeed a difficult language, if you have it as 2 language... And I am afraid my English is little rusty, or less than perfect.. But I try as best I manage to write this difficult, but interesting language.. It is still a lot of France and latin words in it...

I have allways belived that the population in US was pretty wel educated.. US have allways told the world that they have one of the beste educated population on the face of the world.. Some of the best schools are in the US.. So I wounder why not many more american are not puting two and two togheter, and get four.. And not the other they are finding out...

Well, as the saying are going. If You owe the bank 10.000 Dollar you have a problem. If you owe the Bank 100.000.000 Dollar, then the bank have a problem.. US are owing the rest of the world to much money as it is. And for the most part the world would rather die then let the US dollar fall to zero.. If they let it go the whole way, the US dollar would not be wort a shit.. And then the rest of the world would be in problems too.Because them self have so much money in US DOLLAR as the fiat money the world are using as money to pay for products.. This is something that NEVER have been the case before. The whole world are more or less independent of One fiat currency.. And for the moment the currency is US dollar..

I am not a expert, by far I am not even a gifted amateur.. But I try to read some economy, and I am afraid what would happen if the US dollar are falling like a rock.. If you are coming to the point in history where the debtors of US bonds are just stopping up and say: Hey I want no more US currency, dump it on the marked.. If One country are doing it, a small one it would hurt US much.. But if bigger country, like China or Russia are dumping US dollar for say Euro.. Then US are in problem.. Because if the big states are dumping the money, other would follow.. Even worse if many country are banded together to stop using US dollar all together.. That would be a nightmare for everyone with a very Small interest in money I guess??

To have to much in debt, say to owe a bank or in this situation owe the rest of the world more than you can produce in value is always a dangerous thing to do. For the debtor, and for the creditor. For the lender you can always get the promise of money or resources. But if a Country fail to pay back money,you can not do as you do with a person,go home and take valuables.. Either can you demand to take out resources of a big country like US.. In many cases they would better try the best to get a deal, where the country who owe the money are paying back over time what they owe.. But in US case the Credit is just staggering... They are talking about ONE TRILLION DOLLAR IN DEBT by 2009.. How in the world should US manage to pay back ONE BILLION DOLLAR.. You cant print you out of that type of debt.. Then you risk super-inflation..

I doubt the world would be destroyed because of US borrowing to much. Even than the world are more inter-connected economy today then it was 60 year or more ago. (The great depression)The history learn us that even if a Country, like yourself can not pay your debt, the world would survive.. It would recoil in the whole world, but in the long time the world would survive, and thing would be in their function order.. Even after the PAX AMERICA are out of order.. It toke Europe maybe 1000 year to repair itself from the end of the Western Roman Empire. But it would not be that hard today.. I doubt we would have the goths, ruining our day this time around:-)

What I fear is that US in a desperate mode are going to going to a all out war against the rest of the world.. After 9/11 I have fee-led a paranoid strike in the US population I have never seen before.. I have never seen that a fearfully nation, who want to attack everything and everyone who are in the position to "challenge" US supremacy in the world.. This is a dangerous mode I fear would end in catastrophe.. When you have a President who have told the world one time and twice that they are willing to use Nuclear Weapon, not as a last resolve, but as a first resolve against "Hardened targets" in many country, you know you are in problems... When you have generals in Pentagon who REALLY believe they can use nuclear weapon without protest in the world.. You know you are really in problems...

I really hope I am wrong, and that this would end in 2009 when the madness of "Little king George" are out, and a new, more saner president are woting in.. But after 8 year with mr Bush, everything is up for grasp I guess... And I fear that mr Bush are still a man capable of doing mutch harm to US and to the world before he is history...

Diclotican

Sorry my bad engelish, not my native language

[kineneb]

52. "we" have put out lots of propaganda

such as being the best educated.
Well, we (on the whole) are not. Our educational system was designed in the 19th century to train farmers and factory workers to read and be able to basic sums. The average Joe is permanently attached to his/her television, and rarely thinks deeply about anything, except maybe sports.

Some students actually learn something and go on to college; now even college is often seen as a vocational school, to prepare administrators for corporate jobs. The elite have always gone to private schools and then to Ivy League-type universities (like GW Bush), whether or not they actually learned anything. Some of our colleges and universities are very good, others are not.

With luck we will not pull down the entire world economy when we crash. With luck.

[ldf]

62. uh, it is not possible

to think deeply about sports.

:shrug:

[kineneb]

65. haven't met the obsessive score-keeper types, eh? n/t

[CanSocDem]

67. Yeh...like the effect of pro sports...

...on the culture that wants to 'beat' everybody;

Not to mention performance-enhancing drugs vs strictly recreational drugs.

There's just no end...



.

[tavalon]

66. Does it remind you of Germany during the time of Hitlet?

It does to me. We don't have crematoriums nor will we, but the nationalism bred from fear and used in the service of rage is very familiar to one who would read history.

I'm sorry, you are wrong about many of our population being well educated. It might have been so a generation ago, but complacency and conformity to an odd right wing fundamentalist religion seem to have replaced much of that. People on DU are, for the most part highly intelligent and many, if not most who are computer literate are smart, but most of our populace seems lazy, willing sheep, willing to be led to the slaughter.

[AlienGirl]

11. Inflationary bailout

The government is creating money that doesn't really exist and pretending it will never catch up with us.

Tucker

[cliffordu]

14. Call me paranoid......but

Why do I think all the money giveaways and the debt being accrued by the Fed is a ploy to crash the economy during Barack's (Or Hillary's) (sheesh...) first term??

The Republicant's KNOW they are doomed for generations of voters since the Cheney "Administration" has ruined this country's debt ratio, military, and our standing in the world, all while wiping their asses with the Constitution of the United States of America, AND the Bill of Rights.

Are they really that sinister?

Anybody know what Karl Rove is up the these days?

Cheers

[BulletproofLandshark]

15. Exactly

They know their day in the sun is over, so they're deploying a "scorched earth" strategy in order to screw over as many people as possible while laughing all the way to the bank.

And welcome to DU :toast:

[cliffordu]

28. THANKS!

Thanks for the welcome!!

[tavalon]

18. It's not a ploy to crash the economy specifically during Barack or Hillary's first term.

Rather, it's to put off the inevitable crash until the Bush administration can get the fuck out of dodge. This "CEO" president is gonna make the Enron dude look downright saintly.

Karl Rove is working for Faux "News" these days. That, and likely packing for his vacation to Paraguay.

I'm guessing your question "Are they really that sinister?" is rhetorical, right?

I hate watching this slow motion crash up and feeling like there isn't shit I can do about it, except store food, water, blankets etc. and that just seems so freaky to me. I don't want to sound like a fucking survivalist. I want my computer and my heated house and I don't want people to look at me like I'm Nucking Futz for seeing the writing on the wall.

[truedelphi]

21. Paraquay is the new venture for the Bushies. They have plans to

Buy up the water rights there, the way that Bechtel bought up the water rights in Bolivia.

It's expensive, a little - you have to bribe the nation's Senators and what not.

But it explains a little bit about where the nine billion missing dolalrs from the Iraq reconstruction effort ended up.

[awoke_in_2003]

19. "Are they really that sinister?"

I have asked myself that question many times. I keep coming up with "Yes". Welcome to DU

[zeemike]

25. Welcome to DU

Perhaps it is ot so much to crash the economy during a Democratic administration as to further the long term goals of selling off the land and infrastructure of this country to global corporate entrusts.
Don;t they tell us that private sector can do it better than the government? and so they would be doing something great by turning over the property and the means to manage it to the corporation.
Never again then would they ever have to worry about being regulated or taxed.

[cliffordu]

29. Thanks, again for the nice welcome! N/T

[Theres-a]

27. Karl is on Fox news now

He's their official sinister correspondent?

Welcome to DU!:7

[jwirr]

20. And who did the feds quietly borrow it from?

[JerseygirlCT]

59. China? nt

[mckara]

22. We'll Just Love Livin' in a Third World Country!

The good ole U-S of A. The biggest debtor nation in the world, and we continue to dig a deeper hole!

[Hulk]

24. Hope "the fed" is giving them a nice hefty 18% interest rate like they do to plastic users.

That's the repug party in a nutshell. Bitch and moan about hand outs....until it's one for YOU. Such hypocrites.

Didn't we go through this once before with the savings and loans during the reagon crime years??

[Thor_MN]

26. Anyone notice on the new $10 bill, it's "We Ten People"?

"We the People" is overprinted with the Treasury Department seal and the word TEN.

Kind of makes me wonder who the ten are, I know it doesn't include me...

[roamer65]

30. John Williams over at SGS reported this borrowing a bit ago as well.

http://www.shadowstats.com

He's good at his stats and his website gives a lot of good free information. Look at the "Non-borrowed Bank Reserves" chart on the right hand side of his website. The chart has gone negative. I am glad to see people like him and you, UpInArms, trying to keep these gov't hucksters honest.

Without a doubt, this is the LARGEST direct bank bailout since the 1933 bank holiday.

[SleeplessinSoCal]

31. Is this why Bush is hiding in Africa?

[skyounkin]

32. They are doing it

quietly so in the long run they can find a way to charge us for them having to borrow it in the first (or second, or third) place......

I don't care anymore anyway- I'm too busy living my paris hilton life style on my Archie Bunker paycheck....

::sob::

:hide: <------- creditors won't find me here!!

[lisainmilo]

33. Good Grief!

and Bush pledged how many millions on this recent trip to Africa. Oh wait a minute its BILLIONS!


http://africa.reuters.com/wire/news/usnL18682533.html

and he has asked that they have free and fair elections....


http://allafrica.com/stories/200802180237.html


I wonder what he wants from them????

[lligrd]

34. Are They Borrowing It From Our Social Security?

And why do they get attractive rates? Hell, let them pay the 30% interest they charge us.

[defendandprotect]

35. Why aren't we IMPEACHING Bush for bankrupting the Treasury --- ???

Where the hell is Congress and these idiotic candidates ---

no comments on Bush sinking our economy --- ????

And we all sit here quietly waiting for corporate-media and our politicians to do
something really meaningful . . .. ?????

Like stopping Bush in his criminal pursuits --- !!!

[khaos]

37. consolidation

20% unemployment by 2010

[Dark]

38. It's just keysnian economics (sic)

The feds will inject money back into the economy, just like they did with Clinton, Reagan, FDR ...

It will even out.

But, hey, don't let me bust your panic bubble.

[poppysgal]

39. Ah the old pea in the shell trick-hey

:loveya: another amazing example of one hand not knowing what the other hand was doing-oh yeah that's right they know-we just aren't suppose to. See ya soon.

[Blue_Tires]

42. k+r

[donsu]

43. banks borrow from Feds; Fed borrows from China/India

so China/India own the banks until the loan is paid off?

[olddad56]

51. Federal reserve is a private entity that controls our currency. They just print it.

[sarcasmo]

45. Can I borrow forty grand from the Fed to make my books zero?

[muriel_volestrangler]

46. Preliminary figure for the 2 weeks ending Feb 13th: $60 billion

This nice little way of the Fed quietly giving the banks credit was first noticed here on DU nearly a month ago:

What does it mean when American banks have no nonborrowed reserves?

Note the link to the Fed page that lists it says, for the 2 weeks ending Feb 13, 'term auction credity' is up to $60 billion.

http://www.federalreserve.gov/releases/h3/Current/

Also note that until November, the banks supplied the reserves they are required to keep at the Fed (a fraction of the money they hold in accounts, to make sure they can meet a reasonable amounts of withdrawals) from their own vaults. Now, the Fed has lent them even more than this required amount - their 'non-borrowed reserves' are now negative: -$18 billion.

[Ichingcarpenter]

47. Banks "quietly" borrow $50 billion from Fed: report

Source: Reuters

NEW YORK (Reuters) - Banks in the United States have been quietly borrowing "massive amounts" from the U.S. Federal Reserve in recent weeks, using a new measure the Fed introduced two months ago to help ease the credit crunch, according to a report on the web site of The Financial Times.

The newspaper said the use of the Fed's Term Auction Facility (TAF), which allows banks to borrow at relatively attractive rates against a wide range of their assets, saw borrowing of nearly $50 billion of one-month funds from the Fed by mid-February.

The Financial Times said the move has sparked unease among some analysts about the stress developing in opaque corners of the U.S. banking system and the banks' growing reliance on indirect forms of government support.

Read more: http://www.reuters.com/article/topNews/idUSN1821384420080219?rpc=64

---

I have added up well over a trillion dollars
if you follow this search link I did and add up the 239 stories
I found

http://search.us.reuters.com/rsearch/rcomSearch.do?blob=Fed+added++in+temporary+reserves+to+the+banking+system&site=US&srch_Tab=&srch_Results=&srch_MoreResults=

[Ichingcarpenter]

48. Check this link I posted and add up the figures -Well over a trillion given

to the banks, and not one story of them paying it back.

[kineneb]

53. we are sooo screwed. n/t

[Ichingcarpenter]

54. I started following this story in August

It was reported in the news but just as an announcement with no explanation.

The amount of loans are staggering with not one story I could find of them
paying it back. Each loan is real money which has to be printed.
The absence of the M3 reporting now makes it nearly impossible to track
good information

[kineneb]

55. I have been following it as well.

magic money- pooof...not there any more...borrow more magic money...

the feds are taking down a website with other economic info (can't remember which indicator)...guess they don't want us to know How Screwed We Really Are...

quick...more magic money, another "7 day repo"... but do they pay the loan back?...
... another bank looks unstable...more magic money

"I've got a bad feeling about this."

[sarcasmo]

57. Kick, Kickety, Kick, Kick, I don't think Kickety is a word but this is IMPORTANT.

[babydollhead]

61. kick

[DemReadingDU]

63. evening kick

[CanSocDem]

68. Maybe 10 years ago....

....I listened to a radio interview of a guy who claimed, at THAT time, the US economy was held together with illegal drug money. Just sayin'....


.

[katty]

69. Quietly? I think the cat is outta the bag on this one