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

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
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

This story from Bloomberg just hit the wires this morning. Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.

This means that the investment bank's European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn't get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to "give relief" to the bank holding company, which is under heavy pressure.

This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators and without public input. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve.

What this means for you is that when Europe finally implodes and banks fail, U.S. taxpayers will hold the bag for trillions in CDS insurance contracts sold by Bank of America and JP Morgan. Even worse, the total exposure is unknown because Wall Street successfully lobbied during Dodd-Frank passage so that no central exchange would exist keeping track of net derivative exposure.

This is a recipe for Armageddon. Bernanke is absolutely insane. No wonder Geithner has been hopping all over Europe begging and cajoling leaders to put together a massive bailout of troubled banks. His worst nightmare is Eurozone bank defaults leading to the collapse of the large U.S. banks who have been happily selling default insurance on European banks since the crisis began...

Bank of America’s holding company -- the parent of both the retail bank and the Merrill Lynch securities unit -- held almost $75 trillion of derivatives at the end of June, according to data compiled by the OCC. About $53 trillion, or 71 percent, were within Bank of America NA, according to the data, which represent the notional values of the trades.

That compares with JPMorgan’s deposit-taking entity, JPMorgan Chase Bank NA, which contained 99 percent of the New York-based firm’s $79 trillion of notional derivatives, the OCC data show.
 

editec

Mr. Forgot-it-All
Joined
Jun 5, 2008
Messages
41,421
Reaction score
5,660
Points
48
Location
Maine
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

This story from Bloomberg just hit the wires this morning. Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.

This means that the investment bank's European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn't get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to "give relief" to the bank holding company, which is under heavy pressure.

This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators and without public input. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve.

What this means for you is that when Europe finally implodes and banks fail, U.S. taxpayers will hold the bag for trillions in CDS insurance contracts sold by Bank of America and JP Morgan. Even worse, the total exposure is unknown because Wall Street successfully lobbied during Dodd-Frank passage so that no central exchange would exist keeping track of net derivative exposure.

This is a recipe for Armageddon. Bernanke is absolutely insane. No wonder Geithner has been hopping all over Europe begging and cajoling leaders to put together a massive bailout of troubled banks. His worst nightmare is Eurozone bank defaults leading to the collapse of the large U.S. banks who have been happily selling default insurance on European banks since the crisis began...

Bank of America’s holding company -- the parent of both the retail bank and the Merrill Lynch securities unit -- held almost $75 trillion of derivatives at the end of June, according to data compiled by the OCC. About $53 trillion, or 71 percent, were within Bank of America NA, according to the data, which represent the notional values of the trades.

That compares with JPMorgan’s deposit-taking entity, JPMorgan Chase Bank NA, which contained 99 percent of the New York-based firm’s $79 trillion of notional derivatives, the OCC data show.
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.
 
Last edited:
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
...we might owe $154 TRILLION...
He's right EX-Pat. No exaggeration, he's absolutely right...
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.

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.
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA

uscitizen

Senior Member
Joined
May 6, 2007
Messages
45,940
Reaction score
4,908
Points
48
Location
My Shack

Brutus

Senior Member
Joined
Feb 17, 2011
Messages
1,432
Reaction score
64
Points
48
...these banks have no right to put taxpayers in a position where we might owe $154 TRILLION...
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:

expat_panama

Gold Member
Joined
Apr 12, 2011
Messages
2,948
Reaction score
356
Points
130
...It has to do with the derivatives market being so huge, a total of around $700 TRILLION... ...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....
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:

fdic.gov said:
...The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.

The FDIC does not insure safe deposit boxes or their contents.

The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.

How much insurance coverage does the FDIC provide?

The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category...
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?
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
...It has to do with the derivatives market being so huge, a total of around $700 TRILLION... ...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....
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:

fdic.gov said:
...The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.

The FDIC does not insure safe deposit boxes or their contents.

The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.

How much insurance coverage does the FDIC provide?

The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category...
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?
BofA Said to Split Regulators Over Moving Merrill Derivatives to Bank Unit - Bloomberg

Bank of America’s holding company -- the parent of both the retail bank and the Merrill Lynch securities unit -- held almost $75 trillion of derivatives at the end of June, according to data compiled by the OCC. About $53 trillion, or 71 percent, were within Bank of America NA, according to the data, which represent the notional values of the trades. ..
Moving derivatives contracts between units of a bank holding company is limited under Section 23A of the Federal Reserve Act, which is designed to prevent a lender’s affiliates from benefiting from its federal subsidy and to protect the bank from excessive risk originating at the non-bank affiliate, said Saule T. Omarova, a law professor at the University of North Carolina at Chapel Hill School of Law. ..
As a general rule, as long as transactions involve high- quality assets and don’t exceed certain quantitative limitations, they should be allowed under the Federal Reserve Act, Omarova said.

In 2009, the Fed granted Section 23A exemptions to the banking arms of Ally Financial Inc., HSBC Holdings Plc, Fifth Third Bancorp, ING Groep NV, General Electric Co., Northern Trust Corp., CIT Group Inc., Morgan Stanley and Goldman Sachs Group Inc., among others, according to letters posted on the Fed’s website.

The central bank terminated exemptions last year for retail-banking units of JPMorgan, Citigroup, Barclays Plc, Royal Bank of Scotland Plc and Deutsche Bank AG. The Fed also ended an exemption for Bank of America in March 2010 and in September of that year approved a new one.
FDIC To Cover Losses On $75 Trillion Bank of America Derivative Bets | Problem Bank List

Potential losses on Bank of America’s massive $75 trillion book of risky derivative contracts has just been dumped onto the FDIC by the Federal Reserve.

Derivatives, once described by Warren Buffet as “financial weapons of mass destruction” are complex contracts entered into for speculation or to hedge risks linked to a wide variety of other (derivative) financial instruments such as currencies, commodities, interest rates, bonds, etc. In testimony to the Financial Crisis Inquiry Commission in March 2011, Buffett warned that the trillions in derivatives held by major banking institutions could be “disruptive to the whole financial system” and that the risks were “virtually unmanageable.”
Bloomberg Eyes Bank of America's Derivatives Move : CJR

Bloomberg News reports that Bank of America (with Federal Reserve approval) put Merrill Lynch credit-default swaps into BofA’s deposit-holding arm after a credit downgrade caused counterparties to demand it put up billions more in collateral.

Got that? Probably not, so let’s put it another way: Bank of America moved risky insurance contracts to a taxpayer-insured company, ostensibly to save money. The FDIC, which would now be on the hook for losses if the derivatives collapse, is not happy, and the move raises more questions about the health of Bank of America, which has already seen its market value sliced in half this year.

Bill Black puts it this way in a Bloomberg quote:

“The concern is that there is always an enormous temptation to dump the losers on the insured institution.”

And Yves Smith says this:

So this move amounts to a direct transfer from derivatives counterparties of Merrill to the taxpayer, via the FDIC, which would have to make depositors whole after derivatives counterparties grabbed collateral. ..

At base, the question here is why is Bank of America only now moving these derivatives to its depositary institution and why the Fed is willing to help it do so, despite the fact that its own rules are designed to prevent it.

Smith and Black say that this move smacks of “desperation” on the part of Bank of America. If so, it does for the Fed too, which Bloomberg says wants “to give relief to the bank holding company.”

Good work by Bloomberg here keeping an eye out for taxpayers.
Bank of America – FDIC Robbery In Progress with Toxic Derivatives | Veterans Today

This week, Bank of America and its subsidiary, Merrill Lynch was caught trying to launder its admitted $79 trillion dollar debt.

One bank, bordering on collapse owes 5 times more than America’s national debt.

The problem? They are involved in a “stealth” or “end run” program, aided by the Republican Party, to push this debt inside America’s national debt, pushing it onto the American people although it is certain to collapse the dollar.

The other Wall Street banks, though surrounded by protestors, hold well over $400 trillion more in worthless toxic derivatives. We suspect this number could be even higher.
Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository « naked capitalism

The reason that commentators like Chris Whalen were relatively sanguine about Bank of America likely becoming insolvent as a result of eventual mortgage and other litigation losses is that it would be a holding company bankruptcy. The operating units, most importantly, the banks, would not be affected and could be spun out to a new entity or sold. Shareholders would be wiped out and holding company creditors (most important, bondholders) would take a hit by having their debt haircut and partly converted to equity.

This changes the picture completely. This move reflects either criminal incompetence or abject corruption by the Fed. Even though I’ve expressed my doubts as to whether Dodd Frank resolutions will work, dumping derivatives into depositaries pretty much guarantees a Dodd Frank resolution will fail. Remember the effect of the 2005 bankruptcy law revisions: derivatives counterparties are first in line, they get to grab assets first and leave everyone else to scramble for crumbs. So this move amounts to a direct transfer from derivatives counterparties of Merrill to the taxpayer, via the FDIC, which would have to make depositors whole after derivatives counterparties grabbed collateral. It’s well nigh impossible to have an orderly wind down in this scenario. You have a derivatives counterparty land grab and an abrupt insolvency. Lehman failed over a weekend after JP Morgan grabbed collateral.

But it’s even worse than that. During the savings & loan crisis, the FDIC did not have enough in deposit insurance receipts to pay for the Resolution Trust Corporation wind-down vehicle. It had to get more funding from Congress. This move paves the way for another TARP-style shakedown of taxpayers, this time to save depositors. No Congressman would dare vote against that. This move is Machiavellian, and just plain evil.

The FDIC is understandably ripshit. Again from Bloomberg:


The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people. The bank doesn’t believe regulatory approval is needed, said people with knowledge of its position.

Well OF COURSE BofA is gonna try to take the position this is kosher, but the FDIC can and must reject this brazen move. But this is a bit of a fait accompli,and I have no doubt BofA and the craven Fed will argue that moving the risker derivatives back will upset the markets. Well too bad, maybe it’s time banks learn they can no longer run roughshod over regulators. And if BofA is at that much risk that it can’t afford to undo moving over unacceptably risky exposures measure, that would seem to be prima facie evidence that a Dodd Frank resolution is in order.
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

Bank of America Moves a Merrill Lynch Derivatives Unit to an Insured Deposits Unit (Putting FDIC at Risk); Fed approves Move, FDIC Doesn't

Bank of America, at the request of counterparties, just moved a Merrill Lynch derivatives unit to an Insured Deposits unit, under protest by the FDIC.

The FDIC does not like the move because it puts the FDIC at risk. Bernanke is fine with the move, which means the Fed and FDIC are once again in an open feud about risk management.
Federal Reserve Now Backstopping $75 Trillion Of Bank Of America’s Derivatives Trades « The Financial Physician

This is an outrage!

Federal Reserve and FDIC is now Backstopping $75 Trillion Of Bank Of America’s Derivatives Trades

This story from Bloomberg just hit the wires this morning. Bank of America is moving derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC. So now BAC’s deposits of $1 trillion dollars are at risk and by default the U.S. government. A small move in their massive derivatives positions will wipe out all of BACs deposits. Why would anyone leave their savings at this bank?

This means that the investment bank’s European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn’t get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound.

This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve. So now if these derivatives blow up (and they will) the FDIC (taxpayer) will be on the hook.-Lou
Financial Armageddon: FDIC to back $75 Trillion Derivatives Trades | In the Spirit of Jubilee

Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.

This means that the investment bank’s European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn’t get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to “give relief” to the bank holding company, which is under heavy pressure.

This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators and without public input. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve.

What this means for you is that when Europe finally implodes and banks fail, U.S. taxpayers will hold the bag for trillions in CDS insurance contracts sold by Bank of America and JP Morgan. Even worse, the total exposure is unknown because Wall Street successfully lobbied during Dodd-Frank passage so that no central exchange would exist keeping track of net derivative exposure.
If all that doesnt help you, then try trading in your tin-foil hat for a thinking cap.
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
...That would mean us taxpayers would be out 'only' $75T, not $154T. Hey, you can't possibly be serious can you?
BofA Said to Split Regulators Over Moving Merrill Derivatives to Bank Unit - Bloomberg...
Hey knock off the flame war.

Show us the $154T or admit that this is a job for--

Dude, its in the references. BoA has $75 trillion and JP Morgan has $79 trillion they will move into FDIC protected accounts if BoA gets away with it.

You ask for sources, and I give you sources.

Now you want me to read them to you too like some bed time story?

What is your problem?
 

Norman

Platinum Member
Joined
Sep 24, 2010
Messages
29,850
Reaction score
13,093
Points
1,090
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.
It sounds to me more like FDIC is government's abuse of the tax payer, not the other way around.
 

expat_panama

Gold Member
Joined
Apr 12, 2011
Messages
2,948
Reaction score
356
Points
130
...BoA has $75 trillion and JP Morgan has $79 trillion they will move into FDIC protected accounts...
Relevant factoids:
---from the Fed's Flow of Funds Accounts of the United States--September 16, 2011

-----The total value of all US real estate is $18T.
-----The total amount of all private US bank deposits is $6T.
---from FDIC: Your Insured Deposits:
fdic.gov said:
...The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.

The FDIC does not insure safe deposit boxes or their contents.

The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.

How much insurance coverage does the FDIC provide?

The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category...
OK, I'll try and imagine FDIC's bank auditors somehow believing "via various accounting gimmicks" that a limited liability on part of $6T in deposits is now going to ding the taxpayers for $154T because of CDS's on $18T worth of real estate.

That tears it. Now all I can see is--
--
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
...BoA has $75 trillion and JP Morgan has $79 trillion they will move into FDIC protected accounts...
Relevant factoids:
---from the Fed's Flow of Funds Accounts of the United States--September 16, 2011

-----The total value of all US real estate is $18T.
-----The total amount of all private US bank deposits is $6T.
---from FDIC: Your Insured Deposits:
fdic.gov said:
...The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.

The FDIC does not insure safe deposit boxes or their contents.

The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.

How much insurance coverage does the FDIC provide?

The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category...
OK, I'll try and imagine FDIC's bank auditors somehow believing "via various accounting gimmicks" that a limited liability on part of $6T in deposits is now going to ding the taxpayers for $154T because of CDS's on $18T worth of real estate.

That tears it. Now all I can see is--
--
No, all you can see is what you want to see. The experts to include Bloomberg and other financial specialists are stating that the danger is very real if the FDIC lets the banks get away with it.

You cant grasp the simplest facts of this issue, such as the dimensions of the derivatives market which runs around $700 trillion globally.

I am done trying to explain anything more to you as you obviously suffer from a severe case of normalcy bias.

You can take your tin foil hat bullshit and stowe it.
 
Last edited:

expat_panama

Gold Member
Joined
Apr 12, 2011
Messages
2,948
Reaction score
356
Points
130
-----The total value of all US real estate is $18T.
-----The total amount of all private US bank deposits is $6T.
-----from FDIC: Your Insured Deposits:
fdic.gov said:
...The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investments are purchased at an insured bank.

The FDIC does not insure safe deposit boxes or their contents.

The FDIC does not insure U.S. Treasury bills, bonds or notes, but these investments are backed by the full faith and credit of the United States government.

How much insurance coverage does the FDIC provide?

The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category...
OK, I'll try and imagine FDIC's bank auditors somehow believing "via various accounting gimmicks" that a limited liability on part of $6T in deposits is now going to ding the taxpayers for $154T because of CDS's on $18T worth of real estate....
...experts to include Bloomberg and other financial specialists are stating that the danger is very real...
You sound angry and I'm thinking it's my fault for not understanding your approach here. You listen to economic experts the way I listen to medical experts. I'm now remembering how when I tell freinds of mine who are themselves medical doctors, they snicker and scoff at when I tell them of how "the danger is very real", just like I'm snickering and scoffing at your 'experts'.

Hey, don't get me wrong, I think experts are great. It's just that experts have been known to disagree so being an expert isn't enough, we need more. Bloomberg's people have never impressed me as being able to do more than impress non-experts. What would impress me would be (best) press releases from the FDIC or the Fed, or (second best) analysis by Cato/Heritage that agreed with NYT & Bloomberg. Anything that got the right and the left on the same page deserves respect.

Bloomberg's doom'n'gloom doesn't deserved anything. imho the idea of spouting phony alarms just for selling papers is morally wrong. It wastes people's time, and crying wolf makes it harder to get people alerted when the danger actually is real.
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
-----The total value of all US real estate is $18T.
-----The total amount of all private US bank deposits is $6T.
-----from FDIC: Your Insured Deposits:


OK, I'll try and imagine FDIC's bank auditors somehow believing "via various accounting gimmicks" that a limited liability on part of $6T in deposits is now going to ding the taxpayers for $154T because of CDS's on $18T worth of real estate....
...experts to include Bloomberg and other financial specialists are stating that the danger is very real...
You sound angry and I'm thinking it's my fault for not understanding your approach here. You listen to economic experts the way I listen to medical experts. I'm now remembering how when I tell freinds of mine who are themselves medical doctors, they snicker and scoff at when I tell them of how "the danger is very real", just like I'm snickering and scoffing at your 'experts'.

Hey, don't get me wrong, I think experts are great. It's just that experts have been known to disagree so being an expert isn't enough, we need more. Bloomberg's people have never impressed me as being able to do more than impress non-experts. What would impress me would be (best) press releases from the FDIC or the Fed, or (second best) analysis by Cato/Heritage that agreed with NYT & Bloomberg. Anything that got the right and the left on the same page deserves respect.

Bloomberg's doom'n'gloom doesn't deserved anything. imho the idea of spouting phony alarms just for selling papers is morally wrong. It wastes people's time, and crying wolf makes it harder to get people alerted when the danger actually is real.
They arent just crying wolf. In every country so far that has gotten into tremendous debt, from the PIIGS to Hungary and Belgium, the essential problem was when the government agreed to assume the bankers debts because they were just TBTF.

So why do you find it so impossible to happen here in the Good Ole USofA?

Because God is guiding us through the night with a light from above?

Our political whores are no better than the political whores in Greece, Ireland, Italy, Portugal, Spain and Belgium.

But here we have more ability to stop it.

At least the editors and journalists at Bloomberg, the Financial Times, etc can read and comprehend articles that they might not care for.
 

Katzndogz

Diamond Member
Joined
Sep 27, 2011
Messages
65,656
Reaction score
7,474
Points
1,830
If the democrats succeed in saddling the public with 154 trillion in debt, what do you think they expect their cut to be from these companies?
 
OP
JimBowie1958

JimBowie1958

Old Fogey
Gold Supporting Member
Joined
Sep 25, 2011
Messages
63,092
Reaction score
15,686
Points
2,220
Location
Fredericksburg, VA
If the democrats succeed in saddling the public with 154 trillion in debt, what do you think they expect their cut to be from these companies?
Doesnt matter since, if this goes through, after the EMU collapses there wont be a financial system in this country left to take a cut on. The USD will become literally worthless.
 

expat_panama

Gold Member
Joined
Apr 12, 2011
Messages
2,948
Reaction score
356
Points
130
...the essential problem was when the government agreed to assume the bankers debts because they were just TBTF. So why do you find it so impossible to happen here....
We agree that it's possible for bad decisions by key officials to have bad consequences. I'm not sure what your thinking is here, but what the US economy has in it is just not compatible with the idea that--

1--two banks have CDS derivative portfolios that represent liabilities totaling $154T,
2--they could transfer the total $154T CDS losses into FDIC insured accounts,
3--and convince the FDIC to cover the losses at the taxpayer's expense.
My feeding my family depends on my being a number geek--

-- so I have to look at, accept, and work with the US economy as it is. Anyone who believes that three step scenario would have to be a---
 

Most reactions - Past 7 days

Forum List

Top