Tag: US Federal Reserve

All the Coins That’s Fit to Print

A long time ago, the Simpsons did an episode about Congress creating a trillion dollar bill to rebuild Europe after World War II. Apparently, a few pundits and at least one Congressman think that was a documentary:

Rep. Jerrold Nadler has an admittedly “out of the ordinary” solution to the coming fight over the debt ceiling.

“There is specific statutory authority that says that the Federal Reserve can mint any non-gold or -silver coin in any denomination, so all you do is you tell the Federal Reserve to make a platinum coin for one trillion dollars, and then you deposit it in the Treasury account, and you pay your bills,” Nadler said in a telephone interview this afternoon.

I’ll let Doug Mataconis tackle the legal and statutory issues. A short version is that Nadler is using a bill for a purpose for which it was never intended. The authors of the bill have specifically said it was meant for making commemorative coins and such. The idea of avoiding the debt ceiling by printing an inflation-producing trillion dollar coin is way beyond any authority in the law. And even if it weren’t, Congress could override it in about ten seconds.

Stand by for a few, “well, actually…” articles from the left wing claiming this idea isn’t as stupid as it sounds. But rest assured, it is stupider than it sounds.

The Last Bailout … and the Next

Jesus:

Fed Chairman Ben S. Bernanke’s unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners currently owe on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley (MS), got as much as $107.3 billion, while Citigroup took $99.5 billion and Bank of America $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.

The Fed has said it had “no credit losses” on any of the emergency programs, and a report by Federal Reserve Bank of New York staffers in February said the central bank netted $13 billion in interest and fee income from the programs from August 2007 through December 2009.

It wasn’t just US banks; foreign banks got tens of billions in this secret TARP deal. The revealing thing for me is not how much the banks got — I suspected the number was in this ballpark. It’s just how scarily close we came to a complete system meltdown.

What really gets me, however, is how little responsibility has been taken for the banking collapse. Yeah, I know — it was all CRA, ACORN and the government forcing banks to lend money to poor people. But it wasn’t poor people who created credit default swaps. It wasn’t the CRA that made banks stupidly (and often fraudulently) pack mortgages into investment vehicles and sell them to each other. The massive leveraging our bank system was not ACORN’s idea. The bankers can take all the credit they want for those “innovations”. Isn’t someone going to go to jail for this mess? The S&L bailout cost a lot of money too, but at least the crooks went to jail.

In the meantime, we can rest easy knowing that this sort of debt bubble will never … what was that?

This chart looks like a mistake, but it’s correct. Student loan debt has grown by 511% [between 1999 and 2011]. In the first quarter of 1999, just $90 billion in student loans were outstanding. As of the second quarter of 2011, that balance had ballooned to $550 billion.

Obviously the number of students didn’t grow by 511%. So why are education loans growing so rapidly? One reason could be availability. The government’s backing lets credit to students flow very freely. And as the article from yesterday noted, universities are raising tuition aggressively since students are willing to pay more through those loans.

Ah, yes. Now this is one we can blame on liberal interests and politicians. They have been pushing harder and harder on the education bubble. And many want to make it worse with direct federal loans (call it Fannie Ed) or “forgiveness” of loans if someone enters a politically-correct industry.

Hang on to you wallets, guys. It’s going to get worse before it gets better.

Rick Perry pisses off the collectivists

I am not a huge fan of Rick Perry, but I love the drama his warning to Obama and Bernanke, whom he basically warned not to straddle hard working and worried Americans with even more economic damage from the inflation that is sure to be caused by the feds simply printing dollars and spending them – in the hopes of temporarily fooling enough people about the economic disaster they have left us with and squeaking by the 2012 elections – have caused in the the LSM.

On Tuesday, talking about the Fed’s policy of keeping the economy afloat by injecting money (given the anodyne name of “quantitative easing”), Perry commenced with the down-home Texas rhetoric:

“If this guy prints more money between now and the election, I dunno what y’all would do to him in Iowa, but we would treat him pretty ugly down in Texas,” he said.

“Printing more money to play politics at this particular time in American history is almost treacherous — or treasonous — in my opinion.”

Pure gold. It sure as hell looks like Perry read these idiots perfectly, and they are now pissed that he pointed out their strategy to try and save the 2012 elections for the Obamanauts to the voters. The Obamanauts, the big establishment republicans, and the LSM are in full CYA mode right now.

Amercians take note. These crooks do not care about how much pain they are causing you or how much more pain they are straddling us and future generations with. To them it is all about keeping power right now at all costs.