Thanks To QE Bernanke Has Injected Foreign Banks With Over $1 Trillion In Cash 4 1st Time

[sailingaway]

Thanks To QE Bernanke Has Injected Foreign Banks With Over $1 Trillion In Cash For First Time Ever

http://www.zerohedge.com/news/2013-05-21/thanks-qe-bernanke-has-injected-foreign-banks-over-1-trillion-cash-first-time-ever

[Carson]

This is a huge story to me.

Years ago I used to say something like;

"No matter how much honest money the, "We the People" of the world gather together to build their countries the way they want there are those, inside and outside of their governments that can fire up the fake money presses and print up whatever it takes to get their way."



Then Ron Paul helped us get an audit and I knew for sure.


"During a 2½ year period starting at the end of 2007, the Federal Reserve provided more than $16 trillion in secret bailouts to banks and other companies around the world, according to a government audit of some of the U.S. central bank’s operations."

http://www.thenewamerican.com/economy/markets/item/4615-fed-audit-trillions-for-foreign-banks-conflicts-of-interest



July 21, 2011

"The first top-to-bottom audit of the Federal Reserve uncovered eye-popping new details about how the U.S. provided a whopping $16 trillion in secret loans to bail out American and foreign banks and businesses during the worst economic crisis since the Great Depression. An amendment by Sen. Bernie Sanders to the Wall Street reform law passed one year ago this week directed the Government Accountability Office to conduct the study. "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. "This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else.""

http://www.sanders.senate.gov/newsroom/news/?id=9e2a4ea8-6e73-4be2-a753-62060dcbb3c3



Like I said this is huge to me on so many levels.

*It shows that the inflation that we suffer under isn't just loans our own government is taking out. Others outside of our country can fire up the fake money presses to get their way also!

*Some of the money is going to bailout others and going for socialism in other countries.

* It is clearly taxation without representation.

I'm sure I could come up with more as you can also.


I can't wait to see how these dates fit in with sailingaway's articles charts.


Huge I tells ya!

[Zippyjuan]

Total excess reserves in the US come to $1.6 trillion. If the numbers reported are true, foreign banks with branches in the US have 65% of that? Doesn't sound right.

[sailingaway]

Total excess reserves in the US come to $1.6 trillion. If the numbers reported are true, foreign banks with branches in the US have 65% of that? Doesn't sound right.

I'd have to know how you calculate total excess reserves. It is usually in the definition, sort of like the consumer price index not including food.

[TheTexan]

Total excess reserves in the US come to $1.6 trillion.

Minor correction, $1.8 trillion

[Zippyjuan]

I'd have to know how you calculate total excess reserves. It is usually in the definition, sort of like the consumer price index not including food.
The Fed calculates it.
http://research.stlouisfed.org/fred2/series/EXCRESNS
http://research.stlouisfed.org/fred2/data/EXCRESNS_Max_630_378.png


Excess Reserves of Depository Institutions (EXCRESNS)

2013-04: 1,768.834 Billions of Dollars

Monthly, Not Seasonally Adjusted, Updated: 2013-05-17 8:01 AM CDT


Notes:
Excess reserves are those deposits held by depository institutions at the Fed not used to satisfy statutory reserve requirements plus that vault cash held by the same institutions not used to satisfy statutory reserve requirements. Excess reserves equals total reserves less required reserves.

Having excess reserves merely means that you have more in deposits than you have issued in loans. If you have loaned out every penny you can, then your excess reserves are zero. It does not reflect where you got the money from (QE or customer deposits) so it does not necessarily mean they got any money from the QE purchases.

When the Fed makes any purchases as part of their QE actions, they buy from their list of Primary Dealers- not just any banks. The Fed announces how much of what they want to buy and the dealers make bids on how many of the security they want to sell and what price they want. The Fed buys at the price which allows them to purchase the desired quantity. They are the ones who get the QE money. Here is a list of the Primary Dealers:
http://www.newyorkfed.org/markets/pridealers_current.html

Bank of Nova Scotia, New York Agency
BMO Capital Markets Corp.
BNP Paribas Securities Corp.
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Capital Markets America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
HSBC Securities (USA) Inc.
Jefferies LLC
J.P. Morgan Securities LLC
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Mizuho Securities USA Inc.
Morgan Stanley & Co. LLC
Nomura Securities International, Inc.
RBC Capital Markets, LLC
RBS Securities Inc.
SG Americas Securities, LLC
UBS Securities LLC.

[sailingaway]

The Fed calculates it.
http://research.stlouisfed.org/fred2/series/EXCRESNS
http://research.stlouisfed.org/fred2/data/EXCRESNS_Max_630_378.png

I'm even less persuaded if the Fed calculates it. What is M3 these days?

[Zippyjuan]

What does M3 include which M2 does not and is that important information for the Fed to have when deciding monetary policy?

M3 takes M2 (which the Fed does track) and adds in repurchase agreements and Eurodollars (bank accounts in Europe which are denominated in US dollars) plus CDs of over $100k. http://en.wikipedia.org/wiki/Money_supply

The Fed decided that M2 gives them enough information on what is happening with the supply of money that the additional costs of trying to collect and calculate M3 were not worth the extra time and expense- that it offered them no significant additional information so they decided to not do it anymore.


When the Federal Reserve announced in 2005 that they would cease publishing M3 statistics in March 2006, they explained that M3 did not convey any additional information about economic activity compared to M2, and thus, "has not played a role in the monetary policy process for many years." Therefore, the costs to collect M3 data outweighed the benefits the data provided.[15] Some politicians have spoken out against the Federal Reserve's decision to cease publishing M3 statistics and have urged the U.S. Congress to take steps requiring the Federal Reserve to do so. Congressman Ron Paul (R-TX) claimed that "M3 is the best description of how quickly the Fed is creating new money and credit. Common sense tells us that a government central bank creating new money out of thin air depreciates the value of each dollar in circulation."[26] Modern Monetary Theory disagrees. It holds that money creation in a free-floating fiat currency regime such as the U.S. will not lead to significant inflation unless the economy is approaching full employment and full capacity.[27] Some of the data used to calculate M3 are still collected and published on a regular basis.[15] Current alternate sources of M3 data are available from the private sector