Bloomberg News: Banks Got An Undisclosed $13 Billion During Bailout

We will continue to see the economic effects of the "extend and pretend" philosophy of pumping massive amounts of public money into failing banks for a very long time. (Thank God we taught those homeowners a moral lesson by refusing to help them,

We will continue to see the economic effects of the "extend and pretend" philosophy of pumping massive amounts of public money into failing banks for a very long time. (Thank God we taught those homeowners a moral lesson by refusing to help them, huh?) Yes, the banks lied about their stability, the regulators lied to the public, and no, they really didn't pay back TARP in full. But at least we didn't allow homeowners to get a break, and that's the most important thing (as a bunch of millionaires courageously decided).

It's a shame that the European Union isn't learning from our mistakes, either:

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The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. While Fed officials say that almost all of the loans were repaid and there have been no losses, details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

Go read the whole infuriating story. Apparently passing "too big to fail" regulation would have been "punishing success." Meanwhile, senior citizens who are living in their cars and dumpster diving for food because these bastards crashed the economy? Losers!

About Susie Madrak

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