aliasinkhorn's favorite federal-reserve pages, page 1

Online nowAliasinkhorn: .Ink. is a single guy from Huntington, New York, USA.; Likes 3,860 pages, 78 videos, 338 photos • 187 fans • Received 43 reviews; Member since Nov 01, 2007

Favorites » His federal-reserve pages

Display:
List
• Grid

Long road ahead for U.S. economic recovery - MarketWatch: Aug 24, 9:55am 1 review economics, us-economy, federal-reserve
http://www.marketwatch.com/news/story/story.aspx?guid=%7BF8FC9F1B%2D5362%2D44...; Long road ahead for U.S. economy Feldstein, other Jackson Hole participants worry about outlook There is a palpable sense here at the Federal Reserve's exclusive retreat that the road to recovery will be a very long one for the U.S. economy. From the page: "Although the Federal Reserve's latest forecast sees a rebound next year, Feldstein questioned what factors are behind the forecast. "It is not clear where the lift will come from," Feldstein said. " .

Joan Veon -- The Final Globalization of The US Banking System: Jul 10, 11:51pm 2 reviews politics, federal-reserve, us-banking-system
http://www.newswithviews.com/Veon/joan54.htm; THE FINAL GLOBALIZATION OF THE U.S. BANKING SYSTEM From the page: "We live in a globalized world--a world without barriers or borders, which means every aspect of our economic structure has to change. A private corporation, we call the Federal Reserve, controls the majority of our monetary system. To understand the new set of powers being advanced by the U.S. Treasury Department to the Federal Reserve, we first must recognize that the Federal Reserve Act passed in 1913 never gave them (the Feds) total power over our economy. To appreciate the importance of what is currently taking place, we must first realize that as a private corporation, the Federal Reserve is not required to make public who sits on their board of Directors nor who or what banks and corporations hold stock in their private company. Additionally, they are not required to publish an annual report, and I am told, they pay no taxes. So why is it that the American people cannot forgive themselves the interest on their debt? It is because it is owed to a private corporation! The entire financial and business cycle of market highs and lows is controlled by how much money the Feds pump into or glean from the banking system. When they add money to the system, interest rates fall and the market rises and when they take money out of the system, interest rates rise and the stock market falls or corrects. In doing so, this private corporate structure allows for an elite group of people to literally buy low and sell high, thus transferring the wealth into their pockets while those who continue to hold take the "hit."" If your understanding of American institutions is limited to what you learned in public education, take the time to read articles like this one. .

Interfluidity :: Lets not write the Fed a blank check: May 27, 2:11pm 1 review blogs, finance, us-economy, federal-reserve, fed
http://interfluidity.powerblogs.com/posts/1210513606.shtml; Interfluidity :: Let's not write the Fed a blank check From the page: "The core of the Fed's new exuberance is a willingness to enter into asset swaps with banks. The Fed lends safe Treasury securities to banks, and accepts as collateral assets that private markets consider dodgy or difficult to value. (This is the direct effect of the Fed's TSLF program, and the net effect of TAF and other lending arrangements that the Fed sterilizes in order to hold its interest rate target.) In doing so, the Fed puts taxpayer funds at risk. If a bank that has borrowed from the Fed runs into trouble, the Fed would face an unappetizing choice: Orchestrate a bail-out, or permit a failure and accept collateral of questionable value instead of repayment. Either way, taxpayers are left holding the bag. In December, the Fed had $775 worth of Treasury securities. That stock will soon have dwindled to $300B, give or take. The difference, about $475B, represents an investment by the central bank in risky assets of the US financial sector. $475B is an extraordinary sum of money. It is as if the Fed borrowed more than $1500 from every man, woman, and child in the United States, and invested that money on our behalf in Wall Street banks that private financiers were afraid to touch. For bearing all this risk, if things work out well, taxpayers will earn about what they would have earned investing in safe government bonds. If things don't work out well, the scale of the losses is hard to predict. The Fed will claim to have done "due diligence" on its loans, to have valued collateral conservatively, and will point to strength of bank guarantees and the enormous diversity of collateral assets to convince us that its actions are safe and prudent. But rating agencies made the same claims about AAA CDO tranches, and turned out to have been mistaken. Correlations often tend towards one when asset values fall sharply. Central bankers struggling to manage day-to-day crises in financial markets might cut corners when trying to value complex securities. They might find it convenient to err on the side of optimism, as the ratings agencies did, albeit for very different reasons. And even if the Fed is cautious and sober-minded, are we sure that central bankers can value these assets more accurately than private investors? If the Fed were to blow through the rest of its current stock of Treasuries, it would have invested more than $2500 for every man, woman, and child in America. Public investment in the financial sector would have exceeded the direct costs to date of the Iraq War by a wide margin. Would that that be enough? If not, how much more? Just how large a risk should taxpayers endure on behalf of companies that arguably deserve to fail, to prevent "collateral damage"? Have we considered other approaches to containing damage, approaches that shift costs and risks towards those who benefited from bad practices, rather onto the shoulders of taxpayers and nominal-dollar wage earners? Does this sort of policy choice belong within the purview of an independent central bank?" It looks as though US economic vices are sending the country to the poor house.

Bailout of the Year - WSJ.com: Apr 25, 10:18am 1 review finance, taxes, federal-reserve, student-loans, sallie-mae
http://online.wsj.com/article/SB120899430294839827.html?mod=djemEditorialPage; Bailout of the Year From the page: "Guess who's asking Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke for a bailout now? Hint: They are members of an exclusive club who bet wrong on the credit markets last fall. No, it's not a cabal of Wall Streeters, but Democrats in Congress. We're referring to the "student loan crisis" now appearing in a media outlet near you. In September, Congress vowed to make education more affordable by passing the "College Cost Reduction and Access Act." The law reduced the interest rates borrowers pay on federally insured student loans. Backed by the Federal Family Education Loan Program, these loans account for more than 70% of education lending. Taxpayers will fork over $7 billion by 2012 to pay for the rate cuts. But Congress didn't stop there. Convinced that the private lenders who make these loans were reaping too much profit, Congress also cut the yield on each loan. The return on the popular Stafford loan for undergrads was reduced by 70 basis points. For loan consolidations, Congress cut returns by 65 basis points. In a vibrant market, banks might have absorbed these hits and continued to lend. But the combination of legislative fiat and fewer investors willing to buy asset-backed securities amid the credit crunch has put the squeeze on lenders. What's now clear is that Congress didn't merely wring the profits out of student lending. It's blown up the entire student loan market. Market leader Sallie Mae says it now loses money on every new federal education loan. Sallie continues to lend in hopes of a change in D.C., or increased investor demand for securitized loans. The result is that the same man who authored last year's bill to cut lenders' returns has crafted a new bill to subsidize those same lenders. Last week the House passed Education and Labor Chairman George Miller's latest foray into collegiate finance. The bill gives the Department of Education new authority to purchase loans directly from lenders. To summarize: Congress mandated a return on student loans that is too low to attract private capital in the current market. So Congress will now use your money to create artificial investor demand. Taxpayers will bear more risk so that Congress can fashion a new business model to replace the one it just destroyed. The Bush Administration, unwisely but typically, has endorsed this approach." There's a reckoning coming.

Fed acts Sunday to prevent global bank run Monday - MarketWatch: Mar 17, 9:17pm 2 reviews investing, federal-reserve, the-fed, bailouts, bear-stearn
http://www.marketwatch.com/news/story/fed-acts-sunday-prevent-global/story.as...; From the page: "Acting quickly to prevent a run on major global financial firms, the Federal Reserve cut its discount rate by a quarter percentage point to 3.25% and offered to lend money to a longer list of firms than ever before. The extraordinary weekend moves came as J.P. Morgan Chase sealed a deal to buy Bear Stearns Cos. for just $2 a share backed by up to $30 billion borrowed from the Fed. The Fed board gave its approval to that unique funding arrangement, which guarantees JP Morgan against losses from buying Bear. The Fed board also approved the creation of a special lending facility through the New York Fed that would be available to members of its primary dealers list, which includes both commercial banks and investment banks. Investment banks, such as Bear Stearns, have not been allowed to borrow directly from the Fed. JP Morgan has access to the discount window through its Chase Bank subsidiary, but Bear Stearns does not have direct access." This is not a recommended but a must read article. What the Fed has done is brave, like firefighters jumping into a forest fire, making a firebreak to help bring it under control. Here's what they have done ... "Wall Street analysts say the rescue bid was more than just saving one of the world's largest investments banks—it was a prop for the U.S. economy and the global financial system. An outright failure would cause huge losses for banks, hedge funds and other investors to which Bear Stearns is connected." But there are implications which this article deliberately does not address - because stability and confidence and their maintenance are critical.

Bear Stearns exposed as a bank saddled with toxic sub-prime debt - Telegraph: Mar 16, 7:00am 1 review economy, federal-reserve, sub-prime
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/15/ccom115.xml; From the page: "Albert Edwards, global strategist at Societe Generale, said the toppling banks are merely a symptom of a deeper rot. "The banks are not the problem. Nor even the grotesquely leveraged funds. The problem is that an economic bubble financed by ridiculously loose monetary policy is unravelling," he said. "US house prices have a lot further to fall, which will simply crush the global economy. The lesson from Japan in the early 1990s is that the death dance goes on and on and on," he said. The Fed blundered badly in the Slump, delaying rate cuts for too long. It allowed the money supply to implode. It is acting with breath-taking speed this time. Rates have already been cut from 5.25pc to 3pc, and will be slashed again this week. New means of showering liquidity on the banking system are being devised each week. As luck would have it, the world's greatest expert on the financial causes of depressions - Ben Bernanke - happens to be chairman of the Federal Reserve."