Wednesday, August 10, 2011

$16,000,000,000,000+ in Secret "Loans" at 0% Interest

According to the openly avowed Socialist Senator from Vermont, Bernie Sanders, the first time the Federal Reserve System has been officially audited by the Government Accounting Office and the results have been made public.

You can download the .PDF of the audit here.

Or you can look at the Scribd online document here.

"As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders.

Financial "assistance?"

The blog Unelected puts this into perspective:

To place $16 trillion into perspective, remember that GDP of the United States is only $14.12 trillion. The entire national debt of the United States government spanning its 200+ year history is “only” $14.5 trillion. The budget that is being debated so heavily in Congress and the Senate is “only” $3.5 trillion. Take all of the outrage and debate over the $1.5 trillion deficit into consideration, and swallow this Red pill: There was no debate about whether $16,000,000,000,000 would be given to failing banks and failing corporations around the world.

The Socialist Senator from Vermont raises the following point:

Among the investigation's key findings is that the Fed unilaterally provided trillions of dollars in financial assistance to foreign banks and corporations from South Korea to Scotland, according to the GAO report. "No agency of the United States government should be allowed to bailout a foreign bank or corporation without the direct approval of Congress and the president," Sanders said.

Sanders is right. The most relevant point here though, is that the Federal Reserve is NOT an agency of the United States Government. It's a privately owned banking Cartel, created by the International Banking elite FOR the benefit of the International Banking elite.

Sounds conspiratorial?

The list of institutions that received the most money from the Federal Reserve can be found on page 131 of the GAO Audit and are as follows..

Citigroup: $2.5 trillion ($2,500,000,000,000)
Morgan Stanley: $2.04 trillion ($2,040,000,000,000)
Merrill Lynch: $1.949 trillion ($1,949,000,000,000)
Bank of America: $1.344 trillion ($1,344,000,000,000)
Barclays PLC (United Kingdom): $868 billion ($868,000,000,000)
Bear Sterns: $853 billion ($853,000,000,000)
Goldman Sachs: $814 billion ($814,000,000,000)
Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)
JP Morgan Chase: $391 billion ($391,000,000,000)
Deutsche Bank (Germany): $354 billion ($354,000,000,000)
UBS (Switzerland): $287 billion ($287,000,000,000)
Credit Suisse (Switzerland): $262 billion ($262,000,000,000)
Lehman Brothers: $183 billion ($183,000,000,000)
Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)
BNP Paribas (France): $175 billion ($175,000,000,000)
and many many more including banks in Belgium of all places

Secret loans at 0% interest that haven't been paid back, to banks all over the world? You don't say?

You mean this whole time, when people tried to point out that the Federal Reserve System was a privately owned banking cartel owned essentially by international bankers (The Rothschilds), they weren't talking about illuminati reptiles flying around in UFO's?

Sander's makes another good point while missing the forest for the trees:

In fact, according to the report, the Fed provided conflict of interest waivers to employees and private contractors so they could keep investments in the same financial institutions and corporations that were given emergency loans.

For example, the CEO of JP Morgan Chase served on the New York Fed's board of directors at the same time that his bank received more than $390 billion in financial assistance from the Fed. Moreover, JP Morgan Chase served as one of the clearing banks for the Fed's emergency lending programs.

In another disturbing finding, the GAO said that on Sept. 19, 2008, William Dudley, who is now the New York Fed president, was granted a waiver to let him keep investments in AIG and General Electric at the same time AIG and GE were given bailout funds. One reason the Fed did not make Dudley sell his holdings, according to the audit, was that it might have created the appearance of a conflict of interest.

To Sanders, the conclusion is simple. "No one who works for a firm receiving direct financial assistance from the Fed should be allowed to sit on the Fed's board of directors or be employed by the Fed," he said.

The investigation also revealed that the Fed outsourced most of its emergency lending programs to private contractors, many of which also were recipients of extremely low-interest and then-secret loans.

The Fed outsourced virtually all of the operations of their emergency lending programs to private contractors like JP Morgan Chase, Morgan Stanley, and Wells Fargo. The same firms also received trillions of dollars in Fed loans at near-zero interest rates. Altogether some two-thirds of the contracts that the Fed awarded to manage its emergency lending programs were no-bid contracts. Morgan Stanley was given the largest no-bid contract worth $108.4 million to help manage the Fed bailout of AIG.

Sander's entire argument here rests on the presumption that the Federal Reserve is an actual Federal Governmental Agency under the control of the Government.


"Private contractors" like JP Morgan Chase are the de facto owners of the Federal Reserve, Bernanke is their bitch, and the entire US Government - and by extension, we the sheeple, are under it's control.


SlartiBartfast said...

This is odd, the links you provide show dates of july 21, 2011 and yet to date I haven't heard Ron Paul say anything about this. I would think he would be interested in this.

Leahn Novash said...

Now, if USA could somehow get this money back, it could pay all its debt, couldn't it?

Keoni Galt said...

Slarti...very curious point you bring up. Makes one wonder if Ron Paul is legit, of if he's what some have called "controlled opposition."

Leahn - Pay back it's the Federal Reserve?

The debt is not about the money.

The debt is about control.

MarkyMark said...


What I never understood was how the Federal Reserve Act was ever PASSED in the first place! It's blatantly unconstitutional, because Article I, Section 8 EXPLICITLY STATES that only 'Congress can coin money and regulate the value thereof.' How was the Federal Reserve Act ever passed? Moreover, how did it pass muster with the Supreme Court? I don't get it...


Vae Victus said...


The 16th Amendment was never ratified. Secretary of STATE Philander Knox declared that the amendment was ratified, even though records show that very few state legislatures actually ratified it.

dannyfrom504 said...

i'm still getting my feet wet politically, which is why i like this site. this debt crap is just baffling and disturbing to me.

is this administration purposely driving up debt and ruining our republic? and i have to fight/die for these dickbags.

Olave d'Estienne said...

I myself have no idea who controls the Federal Reserve System. Couldn't tell you.

What I do know is that the murkiness surrounding the question of who controls the Fed is a huge problem for anyone who wants monetary policy to be transparent. People who desire democratic control of the Fed are sure it is beholden to private interests; people who desire an independent Fed believe it is controlled politically.

"Politically" is a pejorative for "democratically".

"Privately is a pejorative for "independently".

I am skeptical both of claims that it is too private/profit-oriented and that it is too political. Congress loves foreign aid too. Who know how much they would spend on it if they weren't "helpless" (unwilling) to cut entitlements.

Don't get me wrong: the Fed obviously needs abolishing. No question. If the system were sane, rational, what have you, it would be possible to answer this question:

What determines the size of each category?

The question can barely even be phrased. "Category? Wuzzat?"

For purposes of electing directors, District member banks are grouped by amount of capital into three categories—small, medium, and large. Each group of banks elects one class A and one class B director.

Basically, the banks' power either is or isn't weighted by capital. Let's take a hypothetical district with 90 banks and $30 billion in total capital. I'll wager that either you have each group (small, medium and large) number 30 banks or $10 billion in capital, but of course - not both. The corollary is that either your groups are something like four huge banks electing a Class A & a Class B, and 600 small banks electing one of each as well, or equally huge disparities in total capital.

In years of searching on the web I've never found the answer. So I don't trust the system.