Reginald Kaigler's thoughts on politics, social issues, the economy and world at large.
Visit msnbc.com for breaking news, world news, and news about the economy
Reggie,I wish that this was the extent of their cheating. Take a look at the TARP legislation and look at how the big banks managed to go from begging for money to having enough money to:1. Pay back the TARP money2. Make a lot of profit3. Make enough to pay big bonuses to their execs4. Raise the price of their stocks5. Put lots of cash on their balance sheets to handle the upcoming foreclosure disasterWhere did the money come from?Take a look at the TARP legislation. It allows up to $4 trillion to be lent in the case of an emergency for a term and at the current discount interest rate, with the collateral and wherewithal to pay it back. Since the banks are going to the discount window for money at 0.25% to 0.75% interest they simply borrow the money and buy the treasury notes. Since they are buying T-notes, of course the money will be paid back. Tim Geitner loves it because now he has the captive buyer for the treasuries that nobody is willing to buy in the volume (1.6 trillion/year) that congress needs for their deficit spending. The banks love it because they get tens of billions of dollars in pure profit from the massive volume and the spread. Ben Bernanke loves it because all he has to do is print the money electronically. Congress loves it because they have a source that allows them to keep up their insane spending. Lehman Brothers is just $50 billion. These guys are milking the American tax payer for more than that each year just on the spread.