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Wall Street Aristocracy Got $1.2 Trillion From Fed

Wall Street Aristocracy Got $1.2 Trillion From Fed
Citigroup Inc. (C) and Bank of America Corp. (BAC) were the reigning champions of finance in 2006 as home prices peaked, leading the 10 biggest U.S. banks and brokerage firms to their best year ever with $104 billion of profits. By 2008, the housing market’s collapse forced those companies to take more than six times as much, $669 billion, in emergency loans from the U.S. Fed Chairman Ben S. “These are all whopping numbers,” said Robert Litan, a former Justice Department official who in the 1990s served on a commission probing the causes of the savings and loan crisis. (View the Bloomberg interactive graphic to chart the Fed’s financial bailout.) Foreign Borrowers It wasn’t just American finance. Peak Balance The balance was more than 25 times the Fed’s pre-crisis lending peak of $46 billion on Sept. 12, 2001, the day after terrorists attacked the World Trade Center in New York and the Pentagon. Odds of Recession Liquidity Requirements ‘Stark Illustration’ 21,000 Transactions Rolling Crisis Related:  Crise de la dette privée (subprimes 2008)

Obama Seeks Holy Grail of Housing, Proverbial Free Lunch, Gain With No Pain; It's Another Bank Bailout in Disguise President Obama is in Fantasyland or in some alternate universe. He wants to strengthen the housing market provided The plan helps a broad swath of homeownerThe plan stimulates the economyThe plan costs next to nothingSo says the New York Times in U.S. May Back Refinance Plan for Mortgages The Obama administration is considering further actions to strengthen the housing market, but the bar is high: plans must help a broad swath of homeowners, stimulate the economy and cost next to nothing. Uninspiring Nonsense Frank E. "It almost seems to me you want to have some type of announcement or policy, program or something from the federal government that provides that clear signal that we are here supporting the housing market and this is indeed a good time to really consider buying," Mr. Quite frankly that is idiotic as one of my readers noted in an email. Moreover, two tax credits that blew up just proved it. The last few paragraphs of the article are rather interesting. Got That?

The Great American Bubble Machine | Politics News The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who's Who of Goldman Sachs graduates. Invasion of the Home Snatchers By now, most of us know the major players. As George Bush's last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. But then, any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. The Feds vs. Wall Street's Big Win

Fed's Court-Ordered Transparency Shows Americans `Have a Right to Know' A Supreme Court order that forces unprecedented disclosures from the Federal Reserve ended a two- year legal battle that helped shape the public’s perceptions of the U.S. central bank. The high court yesterday let stand a lower-court ruling compelling the Fed to reveal the names of banks that borrowed money at the so-called discount window during the credit crisis. The records were requested by Bloomberg LP, the parent company of Bloomberg News. In July, Congress passed the Dodd-Frank law, which mandated the release of other Fed bailout details. Fed Chairman Ben S. The financial crisis, which began in August 2007 and peaked after the bankruptcy of Lehman Brothers Holdings Inc. in September 2008, focused the public’s attention on the Fed and its $3.5 trillion effort to rescue the banking system, said U.S. “People wanted to know more about what the Fed was doing,” said Paul, a Texas Republican. ‘Reluctant to Borrow’ Ben S. Ben S. Close Open Photographer: Joshua Roberts/Bloomberg Two-Year Lag

Radar 3 décembre 2008 : Monétisation de la dette, ou la transgression du tabou de l’argent Entre 2000 et 2008, l’endettement global a doublé, passant de 58% a 120% du PIB mondial. Sur ces 60 000 milliards de dollars, quel est le pourcentage des créances qui, devenues douteuses ou irrécouvrables, sera détruit par le processus de liquidation ? Chacun se forgera une opinion sur l’évaluation de la quantité vraisemblable de dette et du coût du service de celle-ci que l’économie réelle peut raisonnablement supporter. De cette réponse dépendra l’ampleur de la récession - voire de la dépression - que nous allons subir. Mais de toute évidence, sous l’effet conjugué de la dévaluation des biens financés à crédit et de la période de récession sévère dans laquelle nous entrons, une part non négligeable de ce papier ne survivra pas en conservant sa valeur nominale actuelle. Et pour cause. Confrontées à une tâche semblable à celle de Sisyphe, les autorités ne peuvent que constater que le volet classique de la politique monétaire - la baisse des taux - a atteint les limites de son action.

OccupyStream - Live Revolution I WANT TO COME BACK AS THE FEDERAL RESERVE. YOU CAN INTIMIDATE EVERYBODY. James Carville once said: “I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.” Carville was very close to getting this right. The only problem is, he fell for the old bond vigilante belief. “I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. I’ve spent a great deal of time trying to debunk the idea that bond markets will one day revolt and cause the Fed to raise rates which will appear like bond vigilante justice. To illustrate this point I ran a few correlations across the yield curve in the USA. What’s interesting in this data is that the bond market is taking its cues almost entirely from the Fed. What’s more interesting is that there appears to be no worry of solvency in this data. 1) The US government should absolutely not be allowed to default.

Faillite bancaire : le droit européen est prêt à faire face mais les financements seront ils là ? Voici résumé le texte d’une conférence tenue à Paris en 2003. Après une très longue introduction permettant de replacer les questions de droit dans leur contexte économique et politique, l’auteur présente de manière plus ramassée les principales innovations de la directive relative à l’assainissement et à la liquidation d’un établissement de crédit (DALEC). Pour traiter le sujet qui m’a été proposé, j’aurais aimé avoir le temps de vous raconter une histoire, voire des histoires… Comme dans une bonne saga de John Le Carré, j’aurais voulu vous raconter comment la C.I.A. utilisait la B.C.C.I. pour financer des groupes militaires en Amérique du Sud, tout en fermant les yeux sur les pratiques douteuses de blanchiment planétaire mises au point par cette banque. Mais, je ne peux décemment pas vous raconter des histoires lorsque je lis le titre de mon sujet « Les apports des nouvelles règles spécifiques sur les faillites des établissements de crédit ». Le premier paradoxe est d’ordre économique.

CHARTS: Here's What The Wall Street Protesters Are So Angry About... The "Occupy Wall Street" protests are gaining momentum, having spread from a small park in New York to marches to other cities across the country. So far, the protests seem fueled by a collective sense that things in our economy are not fair or right. But the protesters have not done a good job of focusing their complaints—and thus have been skewered as malcontents who don't know what they stand for or want. (An early list of "grievances" included some legitimate beefs, but was otherwise just a vague attack on "corporations." So, what are the protesters so upset about, really? Do they have legitimate gripes? To answer the latter question first, yes, they have very legitimate gripes. And if America cannot figure out a way to address these gripes, the country will likely become increasingly "de-stabilized," as sociologists might say. In other words, in the never-ending tug-of-war between "labor" and "capital," there has rarely—if ever—been a time when "capital" was so clearly winning.

Audit Of The Federal Reserve Reveals $16 Trillion In Secret Bailouts Audit Of The Federal Reserve Reveals $16 Trillion In Secret Bailouts By Unelected.org 24 July, 2011Unelected.org Click on the image for a larger picture The first ever GAO(Government Accountability Office) audit of the Federal Reserve was carried out in the past few months due to the Ron Paul, Alan Grayson Amendment to the Dodd-Frank bill, which passed last year. What was revealed in the audit was startling: $16,000,000,000,000.00 had been secretly given out to US banks and corporations and foreign banks everywhere from France to Scotland. To place $16 trillion into perspective, remember that GDP of the United States is only $14.12 trillion. In late 2008, the TARP Bailout bill was passed and loans of $800 billion were given to failing banks and companies. “This is a clear case of socialism for the rich and rugged, you’re-on-your-own individualism for everyone else.” – Bernie Sanders(I-VT) Comments are not moderated.

Yes, the banks are to blame Daniel Davies’s effort to become the most popular man in Britain has, apparently, not developed to his advantage, to quote the Emperor Hirohito. It struck me that there are two opposed explanations for the unusual toxicity of the comments thread that ensued, and they tell us quite a lot about the Great Bubble and the Great Recession that followed. The first would be Daniel’s explanation. The second would be mine. You will of course notice that the basic distinction here is that one explanation is demand-driven and one supply-driven. In itself, this isn’t controversial. How did we decide to try making fireguards out of chocolate, or self-certifying mortgages with negative-amortising interest rates, in the first place? Now, back to the mortgage market. But what about the banks? And one product the banks surely did invent was outsourced mortgage-servicing. But once the servicing function is outsourced, the incentives are actually reversed.

How Paulson Gave Hedge Funds Advance Word Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co. (JPM) Now, amid tumbling home prices and near-record foreclosures, attention was focused on a new source of contagion: Fannie Mae (FNMA) and Freddie Mac, which together had more than $5 trillion in mortgage-backed securities and other debt outstanding, Bloomberg Markets reports in its January issue. Paulson had been pushing a plan in Congress to open lines of credit to the two struggling firms and to grant authority for the Treasury Department to buy equity in them. “If you have a bazooka, and people know you have it, you’re not likely to take it out,” he said. A Different Message At the Eton Park meeting, he sent a different message, according to a fund manager who attended. Stock Wipeout

Federal Reserve made $9 trillion in emergency loans - Dec. 1, 2010 Top recipients of overnight loans made by the Federal Reserve under special program that ran from March 2008 through May 2009.By Chris Isidore, senior writerDecember 1, 2010: 6:05 PM ET NEW YORK (CNNMoney.com) -- The Federal Reserve made $9 trillion in overnight loans to major banks and Wall Street firms during the financial crisis, according to newly revealed data released Wednesday. The loans were made through a special loan program set up by the Fed in the wake of the Bear Stearns collapse in March 2008 to keep the nation's bond markets trading normally. The amount of cash being pumped out to the financial giants was not previously disclosed. All the loans were backed by collateral and all were paid back with a very low interest rate to the Fed -- an annual rate of between 0.5% to 3.5%. Still, the total amount was a surprise, even to some who had followed the Fed's rescue efforts closely. "It makes it very clear this was a very serious, very unusual situation," he said. Sen. Share this

Le Blog d'Olivier Berruyer sur la Crise Le secteur immobilier est historiquement un des piliers de l’économie américaine. Nous allons l’étudier en détail. Ventes de maisons neuves L’écroulement de 2007-2008 est faramineux. Le niveau actuel n’est plus que de 30 % de celui au moment du pic ! Il semble apparaître une légère reprise au cours des derniers mois, par rapport aux 3 années passées, mais c’est très léger… Sur le long terme (et ramenés à un nombre par habitant, sinon la robuste démographie américaine fausserai l’analyse), le pic comme la chute qui ont suivi sont historiques : Les abysses ayant été atteints début 2011, on observe une légère tendance à la hausse. Mises en chantier Comme avant de vendre une maison, il faut la construire, on observe des phénomènes semblables au niveau des mises en chantiers de logements neufs : Là-encore, une légère amélioration est perceptible, mais d’ampleur limitée. Stock de logements neufs Finalement, le stock de logements neufs diminue toujours : Logements vides

Revealed: huge increase in executive pay for America's top bosses | Business John Hammergren, CEO of healthcare provider McKesson, earned $145m last year. Photograph: George Nikitin/AP Chief executive pay has roared back after two years of stagnation and decline. America's top bosses enjoyed pay hikes of between 27 and 40% last year, according to the largest survey of US CEO pay. America's highest paid executive took home more than $145.2m, and as stock prices recovered across the board, the median value of bosses' profits on stock options rose 70% in 2010, from $950,400 to $1.3m. The Guardian's exclusive first look at the CEO pay survey from corporate governance group GMI Ratings will further fuel debate about America's widening income gap. Last year's survey, covering 2009, found pay rates were broadly flat following a decline in wages the year before. This year's survey shows CEO pay packages have boomed: the top 10 earners took home more than $770m between them in 2010. Still, there are no bankers among this year's big winners.

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