The joke is on everyone who isn’t buying gold.
Posted by Adam King on April 15, 2011
Those with strong gold investments will laugh last.
April 15, 2011 – The joke is on everyone who isn’t buying gold. We have known for a long time that the trillions in new Fed money went only to feed Wall Street greed while the government led us down the garden path, placating us with promises and pumping us up with platitudes. Still, when a Congressional order let us peek inside the Fed’s dealings during the bailout, the truth stretches the limits of imagination.
“Why Isn’t Wall Street in Jail?”, an article by Matt Taibbi in the Rolling Stone, reveals the extent of Wall Street’s money grab with full complicity from Bernanke & Co.
Try this one on for size. Remember all those billions in near-zero interest emergency loans to the big banks? Well, many of them used it to buy Treasuries, lending the money right back to the government at 3%. Nice deal.
Then there was the mother of all handouts, “Term Asset-backed securities Loan Facility”, or TALF. That program handed out Bernanke Bucks through “non-recourse” loans, which as the name implies, leaves taxpayers up the creek without a paddle. In essence, some big hedge fund borrows a pile of money from the Fed and uses it to scarf up toxic loans, which the Fed holds as collateral. If the investment pays off, the hedge fund cashes in and keeps the profits. In the more likely case that the insecurities tank, the government keeps the junk and lets the fund walk free and clear.
The best part about TALF is that any well-connected fool could get a slice of the pie. The wife of the chairman of Morgan Stanley (recipient of $2 trillion in bailouts) and her friend, widow of the company’s past president, put up $15 million to found Waterfall TALF. Neither has any real business experience but still the government handed $220 million over to the pair to buy up student loans and commercial mortgages. With little more than their initial capital at risk the gals can keep every bit of profit.
Then there are countless cheap loans to foreign interests. The Arab Banking Corporation of Bahrain – 59% of which is held by Libya’s central bank – got $35 billion. Don’t like the idea of the Fed lending gobs of cash to Qaddafi at interest rates as low as 0.25%? Then you’ll hate that the Treasury gave the Bahrain bank special exemption to prevent freezing its assets through economic sanctions.
Now that all of this is finally coming to light, who is going to jail? Most likely nobody. They’ll just rub our noses in it once again and go about their business of bringing our country to its knees. But those with strong gold investments will laugh last.
Senior Staff Writer – Certified Gold Exchange
US Gold Market