Home > Economy, Politics, Trends > Rewind: 21,000 Banks and Corporations Received $3.3 Trillion in Covert Fed Money

Rewind: 21,000 Banks and Corporations Received $3.3 Trillion in Covert Fed Money

March 22, 2011

Washington Post December 1, 2010 reported this story right before the President signed the bill to extend the Bush tax cuts to the wealthiest Americans to the tune of $2 trillion. What did the unemployed get? A 13-month extension of federal unemployment benefits. The cost of this measure was estimated at $56 billion.

So, here is the rewind on this story and this story has short term and long term consequences. The trend is disturbing as American money is being provided on a preferential basis and not for the direct benefit of everyday Americans or American small businesses.

$3.3 trillion was loaned NOT to individual Americans or small businesses, but to corporations and even foreign entities. When the Republicans say we are broke — that is a prevarication, a lie. When they equivocate over unemployment benefits versus extending the Bush tax cuts that is underhanded. Everyday Americans should be able to borrow at 1-2% as many companies did. Instead, we are seeing banks ripping people off charging $4-5 for an ATM withdrawal. Credit card rates are going up – again. Extra “fees” for this, that, and the other are being charged to people who want to use their credit cards as they cannot get loans.

The exploitation never stops – and it must stop.

Washington Post December 1, 2010: The Federal Reserve pumped trillions of dollars into all manner of banks, investment firms and major companies during the financial crisis, according to documents released Wednesday that reveal for the first time the full scope of the Fed’s emergency lending.

The Fed was compelled by recent Wall Street reform legislation to release details of the special lending programs it undertook in 2008 and 2009, when it deployed a wide range of untested tools to try to fight the financial crisis. The programs included more than 21,000 individual transactions with a total loan value that Bloomberg News tabulates at $3.3 trillion. The programs involved have since been shut down, and most loans have been repaid.

A program to support the market for corporate lending known as commercial paper benefited not only top U.S. financial institutions such as Bank of America and Citigroup, but also was used by iconic American companies such as General Electric and Harley-Davidson.

That and other programs were also used extensively by the U.S. affiliates of foreign firms-including one owned by the South Korean government. The Korean Development Bank used the Fed’s commercial paper facility to the tune of billions of dollars, including a $407 million short-term loan on a single day. Many foreign banks, including the Swiss UBS and the German Deutsche Bank took extensive advantage of various programs.

The disclosures are already drawing a new round of criticism for the Fed.

“After years of stonewalling by the Fed, the American people are finally learning the incredible and jaw-dropping details of the Fed’s multitrillion-dollar bailout of Wall Street and corporate America,” said Sen. Bernie Sanders (I-Vt.), a longtime Fed critic who pushed for the new disclosures, in a statement. “Perhaps most surprising is the huge sum that went to bail out foreign private banks and corporations. As a result of this disclosure, other members of Congress and I will be taking a very extensive look at all aspects of how the Federal Reserve functions.”

The following is a list of just a few of the banks, financial institutions and global corporations that received nearly interest-free loans from the Federal Reserve during the financial crisis…..

Go here to see more…..

Big U.S. Banks And Financial Institutions

Goldman Sachs
JP Morgan Chase
Morgan Stanley
Merrill Lynch
Bank of America
Bear Stearns
Pacific Investment Management Co. (PIMCO)

Big Global Corporations

General Electric

Canadian Banks

Royal Bank of Canada
Toronto-Dominion Bank

European And Asian Banks

Barclays Capital
Bank of Scotland
Deutsche Bank
Credit Suisse
BNP Paribas
Societe Generale
Bayerische Landesbank
Dresdner Bank
The Korean Development Bank (South Korea)

Related: The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (Pub.L. 111-312, 124 Stat. 3296, H.R. 4853), was passed by the United States Congress on December 16, 2010 and signed into law by President Barack Obama on December 17, 2010

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  1. March 26, 2011 at 11:09 pm
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