Debt Hysteria

How can anyone take the debt reduction antics of our government seriously? It’s ludicrous to hear talk of the millions here and the millions there, when the Federal Reserve and our government has doled out trillions to banks, and the majority of citizens don’t even know it.

In her 2009 book “It Takes a Pillage”, Nomi Prins said “…the Fed…continued it’s transformation into a hedge fund of last resort, relaxing its collateral posting rules and lending trillions of dollars to the Street. Where banks once had to pony up secure assets such as Treasury bonds to get loans from the Fed, they could now post far more risky assets in return for very favorable loan conditions, and the Fed would keep a lid on who they were, and how much they got”.

William Greider writes in the January 2011 edition of the Nation magazine -”To get a rough glimpse of what the corporate state looks like, study the Federal Reserve’s list of banking, finance and business firms that received the $3.3 trillion the central bank dispensed in low-interest loans during the financial crisis (this valuable information in revealed only because reform legislators like Bernie Sanders fought for disclosure).”

Again from “It Takes a Pillage“---“Remember, Wall Street of the last ten years has been defined by an insane fixation on borrowing money wherever possible, even borrowing against wealth that didn’t even exist. So, lets just say that all of the banks borrowed up to ten times the amount those securities were once worth-a very conservative estimate, considering how hard banks worked to overturn the net capital rule in 2004, which enabled banks to borrow up to thirty times what they had in their (already illegal) wallets. …even with the conservative estimate, we’re looking at a possible system wide loss of $140 trillion. By that token, the $13 trillion of federal bailouts and loans, including the measly $700 billion in TARP money that the media likes to focus on, is a drop in a big scary bucket.”

Trillions have been given to the banks in secret, maybe this is why Rand Paul, newly elected Senator from Kentucky, is dazzling the masses by complaining that if re-elected and in 8 years this president will have spent close to $46 trillion, (which is not even close to the amount of debt banks piled up for us). 　

No wonder the government is cutting heating assistance to the elderly and food for the poor, this debt is out there and they know it.

Until they start talking about recouping some of the trillions we gave away to banks to cover their fraudulent actions, no one should be taking any of this debt hysteria seriously.