Report: Bailed-out banks earned $13 billion on interest alone

[lonestarnot]

By Andrew Jones
Monday, November 28, 2011

The Federal Reserve kept Congress in the dark about billions in profits generated by big Wall Street firms that used taxpayer dollars to take advantage of below-market interest rates, Bloomberg Markets reported this week.

Firms took advantage of the below-market interest rates offered by the Fed amid President George W. Bush’s bailout program, secretly leveraging $13 billion off taxpayer money, they found.

The report also notes that the Fed did not reveal to Congress which institutions were involved in the loan program, and whether they were even stable enough to receive them.

http://www.rawstory.com/rs/2011/11/28/report-bailed-out-banks-earned-13-billion-on-interest-alone/

[lonestarnot]

1. Disappeared before it got out of the gate. Strange.

[slipslidingaway]

2. Ask Geithner, head of the NY Fed since 2003 and now Treasury Sec. under Obama...

he knows where the skeletons are buried, and Bernanke chair of the Fed under Bush and again nominated by Obama.

[dkf]

3. Actually that is an estimate assuming they invested it a particular way.

From the Bloomberg article which did the calculation:


"While the method isn’t perfect, it’s impossible to state the banks’ exact profits or savings from their Fed loans because the numbers aren’t disclosed and there isn’t enough publicly available data to figure it out."


http://mobile.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html

[lonestarnot]

4. So probably way more then. Thanks.

[dkf]

7. Who knows?

I am not sure what the significance of the numbers they used are, was it in cash so they can assume a cash type return was achieved perhaps? Or could they have funneled it to the investment bank? No idea.

You might be able to make more sense of it. The article goes into a bit more detail on how they arrived at that number.

[xchrom]

5. Recommend

[_eh]

6. "earned"?

No!

[Norrin Radd]

8. Welcome to DU.