Ron Paul: "1/3 Of Fed Bailout Loans Went To Foreign Banks, and 100% of NY Fed Loans"

[sailingaway]

with at the peak, 88% of money going to foreign banks. video here:

http://georgewashington2.blogspot.com/2011/06/ron-paul-88-of-fed-bailout-loans-went.html

[Zippyjuan]

It is a bit confusing how that all works. Foreign banks cannot directly apply to borrow funds from the Fed. If a foreign bank is operating branches in the US what they have to do instead is have their home bank apply to the central bank in their own country for a loan and that central bank issues the money to the Fed (and US banks can use the same proceedure to borrow in other countries) and the Fed dispurses the funds to the US branch of the bank- acting as an intermediary- not the direct lender. Collateral is posted against the loans.

Coming up with a total borrowed amout is also tricky. These are typically overnight (one day) loans but can be rolled over. Say you borrowed $1 million. Now say you rolled it over a whole month due to a difficult financial situation you found yourself in as a bank. That counts as 30 seperate loans or $30 million even though the total amount you had out at any one time was only $1 million so it is easy to inflate the amount of money actually borrowed. Did you borrow $30 million or did you borrow $1 million on 30 occasions?

[Chester Copperpot]

It is a bit confusing how that all works. Foreign banks cannot directly apply to borrow funds from the Fed. If a foreign bank is operating branches in the US what they have to do instead is have their home bank apply to the central bank in their own country for a loan and that central bank issues the money to the Fed (and US banks can use the same proceedure to borrow in other countries) and the Fed dispurses the funds to the US branch of the bank- acting as an intermediary- not the direct lender. Collateral is posted against the loans.

Coming up with a total borrowed amout is also tricky. These are typically overnight (one day) loans but can be rolled over. Say you borrowed $10 million. Now say you rolled it over a whole month due to a difficult financial situation you found yourself in as a bank. That counts as 30 seperate loans or $30 million even though the total amount you had out at any one time was only $1 million so it is easy to inflate the amount of money actually borrowed. Did you borrow $30 million or did you borrow $1 million on 30 occasions?
Would be so easy if the fed just opened up their books and let us audit them right?

Then we'd know everything and wouldnt have to waste our time with uncertainties