Crisis-Hit Banks Flooded Fed with Junk

Banks flooded the Federal Reserve with billions of dollars in “junk bonds” and other low-grade collateral in exchange for much-needed liquidity during the crisis, as the financial sector struggled under a crippling credit crunch, new data show.

Webmaster's Commentary: 

Not quite. What is happening here is that foreign banks, now aware that Wall Street was selling them fraudulent mortgage-backed securities, are doing "putbacks", i.e. demanding the US make good on the bad paper or risk having the entire US financial industry exposed as a bunch of Bernie Madoff clones. That is why when the Fed was handing out that $9 trillion, they did not want to tell anyone where that money went.

Now that a change in the law forced them to reveal who got the money, the American people are wondering just who is expected to repay that $9 trillion, and since there is no way the Fed can make a profit on returned fraudulent mortgages, and since Wall Street still hopes to conceal from the American people the Mortgage-Backed Securities fraud that destroyed the economy and looted their homes, this is the start of the "Gee, we're sorry, but all those foreign banks fooled us and the American taxpayer has to cover that $9 trillion" propaganda.

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