US Taxpayers are bailing out Greece, too?

Just when you think the American taxpayers saving has taken a major blow, the IMF puts the American taxpayer on the list in the Greek bailout package.

The U.S. contributes far more modestly as part of the $39 billion financed by the International Monetary Fund. But the U.S. is the largest shareholder in the IMF, which some commentators and lawmakers have taken to mean the U.S. is forking over a lot of money, too.

"It is simply unfair, as a matter of principle, to force American taxpayers to use their hard-earned money to prop up failed policies in relatively wealthy nations," wrote Rep. Todd Tiahrt, a Kansas Republican, opposing any U.S. participation in a Greek bailout.

online.wsj.com...

Don't get me wrong, I love Greece, but the is a Eurozone Issue. They're the ones who decided to jump on the World Globalization bandwagon.

Hey London, California's got financial problems. How's about a bail-out.

Once, again, the American Taxpayers foot the bill.

wait, WHAT!?

this is crazy, the us is sending our money?

reply to post by 911stinks


You seem to forget it is a loan not a prize! What profit will all these countries including the USA make from the interest. The US is kicking very little comparatively and will most likely see all if not more money back. I do not see your point of agitation. Unless you think Greece will default on this lot too. It all must be some big scam to bludge off the US. I did note you cared little for any of the numerous other countries that are not part of the Eurozone that are also contributing.

As for your globalisition comment, if the US weren't part of it why are they a member of the IMF knowing full well the responsibility membership carries? In fact if the US weren't "on the globalisation bandwagon" why hold seats on so many international forums and organisations?

This is what I can gather about it so far.


www.thaindian.com...

Washington, June 19 (DPA) The US Congress has approved a $106-billion spending bill that includes money for the wars in Iraq and Afghanistan and a loan to the International Monetary Fund (IMF).
The wide-ranging legislation includes money for foreign aid, preventing a flu pandemic and a “cash-for-clunkers” initiative that encourages consumers to trade in older, less efficient cars to help revive the auto industry.

The Senate passed the measure in a 91-5 vote Thursday. The lower House of Representatives approved the same bill 226-202 Tuesday, largely along partisan lines amid complaints from Republicans over the addition of items unrelated to the wars.

...The US will loan $100 billion to the IMF to help stabilise countries facing chronic budget shortfalls amid the ongoing financial crisis.

The G20 agreed to boost the IMF’s lending budget by $500 billion. The European Union, Japan, China and Brazil have also agreed to provide loans.

The legislation includes $5 billion in case of a partial default on the IMF loan. Nearly all Republicans in the House opposed the bill because of the IMF funding, deriding it as a “global bail-out”.

Sounds like a global bail-out fund to me! The U.S. will probably be getting this kind of IMF bailout before long also,and when we do,it is bad news! In comes the WTO and new rules,austerity measures that will cut to the bone,and a certain end to any idea of sovereignty!

online.wsj.com...

First, though all countries are theoretically responsible for investing in the IMF's lending pool, not all of them have currencies that potential borrowers can use. (Think of Zimbawean dollars or Venezeulan pesos.)

The IMF doesn't say that outright. Instead, it uses the concept of "usable resources," meaning it uses money from countries that are considered financially sound. About 21% of the quota contributions to the IMF were "non-usable," according to the IMF, as of January 2010.

Because the U.S., Japan and big European countries are in the "usable" camp, in reality, they finance a larger percentage of IMF funding than their quota would suggest.

But to arrive at an exact percentage isn't possible now for several reasons.

The IMF draws on funds that are pledged to it but that continue to be held in national central banks. At the end of April, before it loaned any of the $39 billion to Greece, the IMF estimated it could lend about $250 billion overall over the coming year.

...To make its loan, the IMF will borrow from the U.S. Federal Reserve and the other central banks it tapsand pay them interest of about 0.25% on the money; the IMF will then charge Greece about 3% on the loan.

On a related note:www.businessweek.com...
German and French banks got $36 billion from AIG Bailout

reply to post by pablos


I don't remind authorizing the effen Fed Reserve to loan the IMF diddly.

The IMF is not regulated by the Constitution. Neither is the FED, but at least we can have two Congressional reps in the FED.

Have we forgot what the demonstrations in Philly were about??

The US paying for the debt of Greece? Yes, as far as US Banks have loans to Greece. And as far as the US are indeed part of the IMF. The US are not the biggest debt owners in this case (which are Germany en France). Let's not forget Greece is a minor economy in Europe (smaller even than Portugal en Ireland). If this goes like domino and Spain would tend to go bankrupt, yes, than we get another, more bleak story.

To the OP: let's not forget where this mess started. The world (US tax payers included) has been paying dearly for the poker play in the US financial sector. Regulation is what is needed and Obama should get some support at it. But that's something only a few seem to agree on here at ATS. Horrible forum, what am I doing here!

reply to post by 911stinks


You are on the board of the Federal Reserve?

Stop fooling around on that computer and do your job then. Don't you have people to rort.

How long have Americans had referendums for every piece of monetary policy? It is news to me.

Seriously. Relax. Your country will see it's money again, or just fund Turkey to fight Greece over the island of Cyprus through dodgy illegal CIA programs to get it's money back.

[edit on 4-5-2010 by pablos]

Originally posted by Spinoza73
The US paying for the debt of Greece? Yes, as far as US Banks have loans to Greece. And as far as the US are indeed part of the IMF. The US are not the biggest debt owners in this case (which are Germany en France). Let's not forget Greece is a minor economy in Europe (smaller even than Portugal en Ireland). If this goes like domino and Spain would tend to go bankrupt, yes, than we get another, more bleak story.

To the OP: let's not forget where this mess started. The world (US tax payers included) has been paying dearly for the poker play in the US financial sector. Regulation is what is needed and Obama should get some support at it. But that's something only a few seem to agree on here at ATS. Horrible forum, what am I doing here!

WRONG! This thing started in London, and offshore accounts and credit default swaps, big corporations gambling in overnight bet using their employees funds. Their 401K's. And then Bush made sure Basel II was pushed through, to allow big banks to take over the little banks, again, at taxpayers expense.

Why defend the crooks!?




[edit on 4-5-2010 by 911stinks]

reply to post by 911stinks


I have a question to you.

Do you consider the debt we have to China good or bad?

If you say bad, then why are you complaining about this, unless you think it is a lose-lose situation?

Originally posted by FritosBBQTwist
reply to post by 911stinks

 

I have a question to you.

Do you consider the debt we have to China good or bad?

If you say bad, then why are you complaining about this, unless you think it is a lose-lose situation?

What business, that has to borrow money, is a healthy business? A healthy business, is a business that doesn't need credit.

The US is some $12 Trillion in debt, and growing. The US economy, is not healthy. We don't have the money to loan. Period. Doesn't take an ANALyst to understand that.

[edit on 4-5-2010 by 911stinks]

Hi there 911,

I'm not saying the London City hasn't played it's part. I'm saying this crisis in Greece has it's origin in the financial crisis which started in the US.

"In the years leading up to the crisis, a combination of factors, including low interest rates, lax lending standards, a proliferation of exotic mortgage products, and the growth of a global market for securitized loans fueled a rapid increase in household borrowing. An influx of new and often speculative homebuyers with access to easy credit helped bid up U.S. house prices to unprecedented levels relative to rents or disposable income."
Reuven Glick and Kevin J. Lansing, Federal Reserve bank of San Francisco, Global Household Leverage, House Prices and Consumption, January 11, 2010.

Deregularization in the US did contribute as well. I'm not defending the crooks, but I would like to make clear European taxpayers did pay for the debts in US as well.

reply to post by Spinoza73


It's about hedge funds. Gigantic, international $85 trillion hedge funds.

Overnight bets, using corporate payroll accounts.

Of course the U.S will join the other countries of IMF to chip in money regarding this bailout of Greece!

The U.S has been a member and a founder of IMF since the Bretton Woods agreement, when all major countries agreed upon using the Dollar as the world's reserve currency.

When they started IMF every country contributed a part of their wealth to the fund - this member 'share' of the fund the IMF call: 'Quotas'

The U.S has the largest 'Quota' of the IMF much due to logical reasons as being the largest economy during the years, and because they're issuing/creating the Dollar for the Petro Dollar Recycling System - and provide Dollars to the World Bank and the rest of the Central Banks & The Bank of International settlements in Switzerland (BIS BANK)

By doing all this, the U.S could build great wealth and has benefited enormously from the Bretton Wood agreement and has had great advantages since 1945 - since all other countries need to buy Dollar to buy their Oil and as payment for certain trade.

[edit on 4-5-2010 by Chevalerous]

reply to post by 911stinks


Well, according to that philosophy the immense amount of people on this world with house payments are also in debt - and therefore should never lend out money.

But what if they lend out money while they are making their house payments - in order to reap a profit that is more beneficial than paying back the debt instantly?

According to many people on this forum, the U.S is handing over its power to China in the form of debt.

So why don't we, the U.S, make countries in debt to us? Seems like a much better investment than the previous ones.

Just because a country/business is in the negatives does not mean it has to shut down. Looking past Goldman Sachs upcoming/pending fraud charges, it is one example of a company that is doing fine despite being "bailed out" and paying back its debt.

How you might ask? By lending and investing - which is exactly what the U.S is doing when bailing out Greece.

Or maybe the car companies that have been bailed out multiple times. They still make profits to date.

Of course, on the shoulders of the tax payer. But since the U.S is a company, in this fight they will win through the shoulders of the Europeans, and in particular, Greece.

reply to post by 911stinks


Part of me says yes this a European issue and they should be the ones footing the bill. Then there is the humanitarian side of me that say's we should help them; after all would you not be thankful if we were in their situation and they where capable of helping? I think I'll stick with, if I have to go with one less meal a day so my brother can eat too philosophy on life. We are all human beings.

Then again everyone is different and I don't expect people to feel the same as I do.

reply to post by 911stinks


You really should do some research into business and fiscal environments before opening your mouth. You don't seem to understand very much. A healthy business does go into debt regularly. That is usually how a corporation starts. By going into debt to fund expansion programs. Do you think the guy that started Mcdonalds didn't ever get a loan to expand. How do people set up successful shops and businesses without raising capital from investors which then gets paid back.

You refered just now to America as a business. But I thought America was not on the "world globalisation bandwagon". Sounds like your thoughts are conflicted.