Okay, this article validates what I have been writing about for the past year. Please read and understand the critical juncture we are in at the moment. Now I ask you why everyone's concerns have been misplaced? Could this be because they want to distract you from the REAL issue that needs to be addressed. ERGO, Obama and his surrogates have been spouting off about the U.S. government spending $10 billion every MONTH in Iraq, when we ALL should have been paying attention / focusing on the taxpayers spending almost a half a TRILLION PER DAY saving the banks.
The Federal Reserve has become a permanent crutch to the banking institutions which in turn enables the banks to not want to get well and try to walk on their own [/Analogy]. Any kind of WELFARE should ONLY be short-term to help whomever get back on their feet. Prolonged welfare such as this causes the banks to be dependent and operate under FALSE PRETENSES. ALL of the banks had been severely hemorrhaging for the past year, with the Federal Reserve siphoning BILLIONS of dollars into the system everyday KNOWING full well that this money will NEVER be paid back. Meanwhile, the general public has all the while been left in the dark and NEVER informed by the MEDIA who is supposed to be looking out for their BEST interest! Click here to read the article in its entirety from Reuters.
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Reuters.com
Banks borrow record $437.5 billion per day from Fed
Reporting by John Parry; Editing by Leslie Adler
Fri Oct 17, 2008 12:38am EDT
NEW YORK (Reuters) - Financial institutions ran to their lender of last resort for record amounts of cash in the latest week, under extreme pressure from the worst global financial crisis in a generation, Federal Reserve data showed on Thursday.
Banks and dealers' overall direct borrowings from the Fed averaged a record $437.53 billion per day in the week ended October 15, topping the previous week's $420.16 billion per day.
Some analysts are concerned that banks' dependence on Fed lending might become long term and difficult to change.
"The banking system is going to become addicted to this very cheap money. Unwinding it will be very difficult," said Howard Simons, strategist with Bianco Research in Chicago.
"We have effectively allowed the central banks to disintermediate the banking system. Why would I want to borrow from you if I could do it with the central bank, because they can always print it up and say 'here'... and they are in the business now of making sure I stay in business," Simons said.
Primary credit discount window borrowings averaged a record $99.66 billion per day in the latest week, up from $75.0 billion per day the previous week.
Primary dealer and other broker dealer borrowings were $133.87 billion as of October 15, versus $122.94 billion on October 8.
"Other credit extensions", mostly reflecting loans to insurer AIG, were $82.86 billion as of October 15, versus $70.30 billion as of October 8.
The Fed's lending to banks to enable them to purchase asset-backed commercial paper from money market mutual funds was $122.76 billion as of October 15, versus $139.48 billion on October 8. Article continued...
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