This in my opinion this is the greatest crime in history, the person or persons that planned and orchestrated this should be jailed even though this was done legally. Hopefully all people will realize that the government is no longer on our side and needs to be stopped in giving away taxpayers money.
The following information is public information on many government websites also have included many news articles and they can be accessed by everyone, in the following document I will try to explain how they have done this. Bill S2856 (section 1) was passed to begin paying interest from the Federal Reserve on reserves (bank balances held in the Federal Reserve) this also includes foreign banks, the original effective date was to start on October 1, 2011. The date of bill S2856 was changed in bill HR1424 (section 2) to take effect on October 1, 2008 along with the Economic Emergency Stabilization Act of 2008 allowing the treasury to spend 700 billion dollars to purchase distressed assets and make capitol injections into banks. In the following months there have been several reports of banks hoarding cash (section 5) why I wonder? Deposits at the Federal Reserve have never been higher (section 7 and 8) even Wikipedia has this information (section 10), but mostly this has been ignored by the main stream media. The current deposits total $955,220,000,000 as of May 20, 2009 (section 8) I am not an accountant and could not imagine the amount of money that is being paid out on this astronomical figure, but the Congressional Budget Office has projected estimates (section 9) keep in mind this estimate is based on the start date of October 1, 2011 on normal deposits of 10 to 20 billion dollars and not October 1, 2008 on figures of 900 billion dollars. Where did the banks in the United States get this large amount of money (bailout funds), why from me, you, your children, your grandchildren and generations to come? Is this the perfect crime only time and the judgment of the population will decide, I only hope many will open their eyes to what is going on around them. I have included relevant articles from news sources and government websites that I have not specified in this article they are for more information on this crime.
Many will think this is an attempt to discredit the government or one of the political parties involved and may even think this was written by some nutcase, but sorry I do not try to do any of these only to inform people of the truth with verifiable information. Take the time check the facts from this document, see for yourself that all I have said is true and has been done legally in front of everyone while we were not paying attention. I have learned a lesson while researching this information to pay attention with what is going on around me and to not only be concerned with my own life.
This is the Federal Legislation website if anyone needs to verify the bills below, click on advanced search to access previous year’s legislation pick year of congress and enter bill or keyword.
http://www.govtrack.us/congress/legislation.xpd
1) Bill S2856 for Federal Reserve to (Section 201) start paying interest on bank reserve and excess reserve deposits (Section 203) starting in October 1, 2011. This bill became law on October 13, 2006
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:s2856enr.txt.pdf
2)Bill HR 1424 Economic Emergency Stabilization Act of 2008 (Section 128) date change for Bill S2856 to October 1, 2008, this was tucked neatly into a bill that no one was allowed to read and threatened with marshal law to hurry up and pass.
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=110_cong_bills&docid=f:h1424enr.txt.pdf
3) Fed asks for authority article.
http://blogs.wsj.com/economics/2008/05/07/fed-to-seek-authority-to-pay-interest-on-reserves/
4) Fed Paying Interest on Reserves: an Old Idea with a New Urgency
http://blogs.wsj.com/economics/2008/04/29/fed-paying-interest-on-reserves-an-old-idea-with-a-new-urgency/
5) Banks hoarding cash why, maybe large interest payments?
http://businessfinancemag.com/blogpost/what-wrong-tarp-1210
http://www.forbes.com/2009/02/12/ecb-banks-borrowing-markets-econ-0212_libor_12.html
http://www.philly.com/philly/business/Andrews_Banks_hoarding_cash.html
6) From the Federal Reserves own website, why so many changes in the formulas and rates?
http://www.federalreserve.gov/monetarypolicy/reqresbalances.htm
http://www.federalreserve.gov/newsevents/press/monetary/20081006a.htm
http://www.federalreserve.gov/newsevents/press/monetary/20081022a.htm
http://www.federalreserve.gov/newsevents/press/monetary/20081105a.htm
http://www.federalreserve.gov/newsevents/press/monetary/20081216d.htm
7) Federal Reserve Deposits
http://www.forbes.com/2009/02/03/banking-federal-reserve-business-wall-street-0203_loans.html
http://www.rgemonitor.com/financemarkets-monitor/254725/why_exactly_does_the_fed_pay_interest_on_reserves
8) From the Federal Reserves own reports, find the following in the report (remember this figure is in millions of dollars). Also under Release Dates at the top of page on any of these reports you can find past reports.
Current report (this link will change when archived). Depository institutions 955,220
As of May 20, 2009
http://federalreserve.gov/releases/h41/Current/
http://federalreserve.gov/releases/h41/20090507/
9. Consolidated Statement of Condition of All Federal Reserve Banks (continued)Millions of dollars Depository institutions 825,623 Wednesday May 6, 2009
http://federalreserve.gov/releases/h41/20090108/
9. Statement of Condition of Each Federal Reserve Bank, January 7, 2009 (continued)Millions of dollars Depository institutions 846,140 Total
http://federalreserve.gov/releases/h41/20081002/
4. Consolidated Statement of Condition of All Federal Reserve BanksMillions of dollars Depository institutions 179,291 Wednesday Oct 1, 2008
http://federalreserve.gov/releases/h41/20080807/
5. Statement of Condition of Each Federal Reserve Bank, August 6, 2008 (continued)Millions of dollars Depository institutions 10,862 Total
9) Congressional budget office estimates costs in millions to taxpayers, but date change starts in 2008 not 2011 and the estimates are based on normal deposits.
http://www.cbo.gov/doc.cfm?index=7692&type=0
10) http://en.wikipedia.org/wiki/Emergency_Economic_Stabilization_Act_of_2008
Taken from Wikipedia website.
The Fed announced that it would begin paying such increased interest on both reserve and excess reserve balances on October 6, 2008.[153] Banks immediately increased the amount of their money on deposit with the Fed, up from about $10 billion total at the end of August, 2008, to $880 billion by the end of the second week of January, 2009.[154][155] In comparison, the increase in reserve balances reached only $65 billion after September 11, 2001 before falling back to normal levels within a month.
How much interest is paid on $800,000,000,000??????????
Have found more important information on this and it looks like Senator Chris Dodd knew this would increase the federal deficit, as stated in a letter dated October 1, 2008 from the Congressional Budget Office Director Peter R. Orszag to The Honorable Christopher J. Dodd Chairman Committee on Banking, Housing, and Urban Affairs United States Senate.
http://www.cbo.gov/ftpdocs/98xx/doc9852/hr1424Dodd.htm
Quote from the letter:
Other provisions in Division A would on net increase the budget deficit. For example, the legislation would allow the Federal Reserve to pay interest immediately on certain reserve balances of depository institutions, rather than starting on October 1, 2011, as allowed under current law. CBO estimates that, over the next three years, the provision would reduce the Federal Reserve’s payments of its profits to the Treasury, which are classified as revenue in the federal budget.
Another reason Bill S 2856 from 109th Congress in 2006 needs to be repealed, this is just another way they are allowing corporate America to commit crimes legally. Sadly not a single member of Congress voted against this Bill, the Senate passed it unanimously and the House passed it with 417 yea votes with 15 not voting.
From the Bill:SEC. 720.
ELIMINATION OF CRIMINAL INDICTMENTS AGAINSTRECEIVERSHIPS.(a) INSURED DEPOSITORY INSTITUTIONS.—Section 15(b) of theFederal Deposit Insurance Act (12 U.S.C. 1825(b)) is amended byinserting immediately after paragraph (3) the following:‘‘(4) EXEMPTION FROM CRIMINAL PROSECUTION.—The Corporationshall be exempt from all prosecution by the UnitedStates or any State, county, municipality, or local authorityfor any criminal offense arising under Federal, State, county,municipal, or local law, which was allegedly committed bythe institution, or persons acting on behalf of the institution,prior to the appointment of the Corporation as receiver.’’.(b) INSURED CREDIT UNIONS.—Section 207(b)(2) of the FederalCredit Union Act (12 U.S.C. 1787(b)(2)) is amended by addingat the end the following:‘‘(K) EXEMPTION FROM CRIMINAL PROSECUTION.—TheAdministration shall be exempt from all prosecution bythe United States or any State, county, municipality, orlocal authority for any criminal offense arising under Federal,State, county, municipal, or local law, which wasallegedly committed by a credit union, or persons actingon behalf of a credit union, prior to the appointment ofthe Administration as liquidating agent.’’.
In closing just to let everyone know I am not a reporter and did not write this for financial gain only to inform, the reason I wrote this is last year an internal alarm went off when I heard about the bailout and I knew something was not right about what was happening. I like to think of it as starting a journey to the truth and I hope this is found out by all.
Sincerely,
Average Citizen
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3 comments:
I emailed an economist about the interest paid by the federal reserve and this is the response I received, the link to another article that was provided in the response ask more questions.
The IOR policy is likely here to stay - other central banks, like the ECB, use it as well. I agree. I don't understand why the IOR rate remains at a level above zero, as it serves as an incentive for banks to hold reserves. I believe that the Fed likes the IOR policy in place in order to sterilize the monetary base if it ever does indeed turn into money. However, why the Fed keeps the rate at its current level (0,25%, I believe) is only a matter of function. The IOR rate is defined at the level of the federal funds rate - so unless they change the equation again (they changed it maybe twice since its induction), it will stick at the federal funds target. The cost to taxpayers could rise if the Fed started hiking the fed funds rate and banks still were not inclined to lend at a larger profit margin (on the private market).
Macro and other market musings writes a nice article on this subject: http://macromarketmusings.blogspot.com/2009/04/there-is-no-free-lunch-in-central.html
This statement is disturbing.
In the Domestic Policy hearing on Bank of America and Merrill Lynch merger on CSPAN Thursday June 25th at 3 hours and 6 minutes into video, Representative Jim Jordan asked about the stimulus money in what it has created in the current money supply and Chairman Bernanke’s answer was that the tarp funds were not in general circulation and were in electronic deposits within the Federal Reserve currently. The first point that bothers me about that statement is if these funds are on deposit with the Federal Reserve were they really needed to bailout the banks? And second the bill S.2856 from 109th Congress allows the Federal Reserve to pay interest on bank deposits within the Federal Reserve. This bill should have been effective on October 1, 2011 and was changed in bill HR.1424 Economic Emergency Stabilization Act of 2008 to October 1, 2008. The Congressional Budget Office has a cost estimate on the normal reserve balances of $1.4 billion over the 2012-1016 periods with the large deposits in the Federal Reserve what are the cost to taxpayers on the interest payments to these deposits?
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