Secret Fed Loans Gave Banks Undisclosed $13B

Secret Fed Loans Gave Banks Undisclosed $13B

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

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Also, a strange turn of events -

Barney Frank to Announce Retirement

So Barney Frank, after 12 tems is not going to be running for re-election. He sat on the committee that oversaw bank regulation among other things.

The Banks fought for a few years to keep the secret bailouts from seeing the light of day. It finally was released, 1.2 trillion in loans, 13 billion profit by taking advantage of the low rates.

I think its time people contact their reps and demand changes. People must get involved if we are going to fix things / stop this mess from continuing.

The thing that's staggering to me is is this, 7.77 trillion dollars in direct loans from the FED that weren't even included in the much publicized 700 billion TARP deal.

At least TARP had some strings attached, this didn't, and Bloomberg News had to file FOIA requests to dig this stuff out into the open.

$7.77 Trillion The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year. “TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing

Source:www.bloomberg.com...

I believe that banking institutions are more dangerous to our
liberties than standing armies. If the American people ever allow
private banks to control the issue of their currency, first by
inflation, then by deflation, the banks and corporations that will grow
up around [the banks] will deprive the people of all property until
their children wake-up homeless on the continent their fathers
conquered. The issuing power should be taken from the banks and restored
to the people, to whom it properly belongs.Thomas Jefferson

Didn't an audit of the Fed by the GAO reveal upwards of 16 trillion in secret bailouts?

Audit of the Federal Reserve Reveals $16 Trillion in Secret Bailouts

I don't know what the veracity of this claim is, but it uses the GAO's own report for a source;
Source: www.gao.gov...

No matter what, their needs to be a thorough audit of everything, especially during the time frame of 2007-2009, as to who got what. I seriously don't see that ever happening unless Ron Paul is elected.