US Taxpayers to backstop $154 TRILLION of Wall Street Debt?

Discussion in 'Economy' started by JimBowie1958, Oct 19, 2011.

  1. JimBowie1958
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    JimBowie1958 Old Fogey

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    I have been looking for some statistics to see what the total derivatives for JP Morgan and BoA are, but I am guessing Bloomberg is fairly trustworty.

    If so, this is an outragerous abuse of the FDIC insurance, and these banks have no right to put taxpayers in a position where we might owe $154 TRILLION bill fo bad derivative contracts on the part of these foolish banks.

    HOLY BAILOUT - Federal Reserve Now Backstopping $75 Trillion Of Bank Of America's Derivatives Trades - Home - The Daily Bail

     
  2. expat_panama
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    expat_panama Silver Member

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  3. editec
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    editec Mr. Forgot-it-All

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    He's right EX-Pat. No exaggeration, he's absolutely right.



    Basically, when it all started unraveling -- back when the Banksters realized that they were all potentially insolvent; back when they realized that the assets they thought they owned were in fact so impossible to evaluate because they was debt instrument FICTIONS --- debt instruments that were so impossible to value that the banks even stopped lending EACH OTHER with overnight loans?

    The FED and TREASURY pledged to secure all that toxic debt.

    Was that legal?

    No. Absolutely not. Neither the FED nor the Treasury was really authorized to do that.

    But had they NOT done that, our banking and finace system would have totally melted down back in 2008.


    Welcome to Republo-Cratic America. Land of too big to fail Socialism for the rich, and never give a citizen an even break predatory capitalism for the rest of us.
     
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    Last edited: Oct 19, 2011
  4. expat_panama
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    expat_panama Silver Member

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    Then please tell me how we might owe $154T, considering that the grand total of all the money Americans owe is $14T which has been steadily falling for three years now.
     
  5. JimBowie1958
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    JimBowie1958 Old Fogey

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    It has to do with the derivatives market being so huge, a total of around $700 TRILLION. The Credit Default Swaps are like insurance for equities and the issuers of this insurance do not require the subscribers to actually own the equity insured with the CDS. For every dollar of equity ijnsured, there are eight to ten dollars in CDS' issued against it. And that is just CDS, the derivatives market has all kinds of contrived crap in it, and some good stuff too.

    By shifting the speculative investment accounts that hold all this derivative exposure into FDIC protected accounts, these banks plan to have FDIC cover their losses via various accounting gimmicks. Since the FDIC cannot possibly cover that much money, the US government will either have to take on the debt of the FDIC or default on its obligations which will cost us exponentially higher interest rates on our current debt.

    The only thing to do is to put a dead stop on this move now before it encourages JP Morgan and the rest to do the same thing and put US taxpayers on the hook for the banks stupid investments.
     
  6. JimBowie1958
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    JimBowie1958 Old Fogey

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    LOl, no its a googleplex times worse than you can possibly imagine in your worst nightmare before and/or after the use of any mind altering drug you might try.
     
  7. uscitizen
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    uscitizen Senior Member

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    Globalism. It is not only US debt.
     
  8. Brutus
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    Brutus Senior Member

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    too stupid and liberal!!! Its like saying the banks have no right to take advantage of tax breaks that liberals put into the tax code for them!

    The liberals created a monster crony capitalist government and now they're complaining about it. See why we are 100% positive a liberal will have a low IQ?
     
    Last edited: Oct 19, 2011
  9. expat_panama
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    expat_panama Silver Member

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    Maybe you can save me all the trouble of getting my tinfoil hat back on by commenting on this quote from FDIC: Your Insured Deposits:

    So let's say these Banks convinced those gullible fools at the FDIC "via various accounting gimmicks" that 300 million Americans --every man, woman, and child-- had deposited over a quarter million in their defaulting bank. That would mean us taxpayers would be out 'only' $75T, not $154T.

    Hey, you can't possibly be serious can you?
     
  10. JimBowie1958
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    JimBowie1958 Old Fogey

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    BofA Said to Split Regulators Over Moving Merrill Derivatives to Bank Unit - Bloomberg

    FDIC To Cover Losses On $75 Trillion Bank of America Derivative Bets | Problem Bank List

    Bloomberg Eyes Bank of America's Derivatives Move : CJR

    Bank of America – FDIC Robbery In Progress with Toxic Derivatives | Veterans Today

    Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository « naked capitalism

    Mish's Global Economic Trend Analysis: Bank of America Moves a Merrill Lynch Derivatives Unit to an Insured Deposits Unit (Putting FDIC at Risk); Fed approves Move, FDIC Doesn't

    Federal Reserve Now Backstopping $75 Trillion Of Bank Of America’s Derivatives Trades « The Financial Physician

    Financial Armageddon: FDIC to back $75 Trillion Derivatives Trades | In the Spirit of Jubilee

    If all that doesnt help you, then try trading in your tin-foil hat for a thinking cap.
     

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