✅Check out my private, online investment community (Rebel Capitalist Pro) with Chris MacIntosh, Lyn Alden and many more for $1!! click here
✅Rebel capitalist merchandise …(read more)
LEARN MORE ABOUT: Bank Failures
REVEALED: Best Investment During Inflation
HOW TO INVEST IN GOLD: Gold IRA Investing
HOW TO INVEST IN SILVER: Silver IRA Investing
These Charts Prove Fed Is STILL Bailing Out The Banks
The financial crisis of 2008 was a devastating blow to the global economy, causing millions of people to lose their homes, jobs, and savings. One of the key culprits behind the crisis was the reckless behavior of major banks, who engaged in risky lending practices and complex financial derivatives. As a result, governments around the world were forced to intervene and bail out these banks to prevent the collapse of the entire financial system.
While the bailout was sold to the public as a necessary evil to stabilize the economy, many critics argue that it was simply a way of rewarding the very institutions that caused the crisis. In the years that followed, politicians promised that such bailouts would never happen again and that banks would be held accountable for their actions. However, recent data suggests that the Federal Reserve, the United States’ central bank, is still actively bailing out the banks.
Several charts detailing the Federal Reserve’s actions raise serious questions about its role in propping up the banking industry. The first chart shows the significant increase in the Fed’s balance sheet since the financial crisis. Before the crisis, the Fed’s balance sheet stood at around $900 billion. As the crisis hit, the Fed started purchasing assets such as mortgage-backed securities and government bonds, which led to a ballooning of its balance sheet to more than $4.5 trillion. Despite some fluctuations over the years, the Fed’s balance sheet remains at an unprecedented level today.
Critics argue that this expansion of the Fed’s balance sheet is nothing more than a bailout for the banks. By purchasing these assets, the central bank is effectively injecting money into the financial system, providing much-needed liquidity to the banks. This liquidity allows the banks to continue operating without facing the consequences of their risky behavior. In essence, the Fed is using taxpayer money to prop up the very institutions that caused the crisis.
Another chart that raises eyebrows is the zero or negative interest rates set by the Federal Reserve. After the crisis, the Fed decided to cut interest rates to near-zero levels in an attempt to encourage borrowing and stimulate economic growth. This policy has had adverse effects, such as punishing savers who rely on interest income and distorting financial markets. Critics argue that these low interest rates primarily benefit the banks, as they can borrow money at near-zero rates and then lend it out at higher rates, pocketing the difference.
Furthermore, the Federal Reserve’s actions during the COVID-19 pandemic have only served to deepen suspicions of continued bank bailouts. As the pandemic struck, the Fed embarked on an aggressive bond-buying program, injecting trillions of dollars into the financial system. This flood of liquidity once again benefits the banks, enabling them to weather the storm and even increase their profitability during uncertain times.
While proponents argue that these actions were necessary to prevent a complete collapse of the economy, critics assert that they are a continuation of the same policies that led to the financial crisis. The banks are being shielded from the consequences of their risky behavior, while everyday citizens bear the brunt of the economic downturn.
It is crucial to hold banks accountable for their actions and ensure that they operate in a responsible manner. The Federal Reserve’s actions, as illustrated by these charts, raise doubts about whether the lessons from the financial crisis have truly been learned. As taxpayers, we should demand transparency and accountability from our central bank and question whether current policies are truly in the best interest of the wider economy. Only by doing so can we hope to prevent a repeat of the disastrous events of 2008 and ensure a more stable and equitable financial system.
Until, November 5 2024 . Election Day .
we need zirp
Analysis within the macro economic box has the implicit assumption that there will be no
overriding issues outside the box. However it appears America is surrendering to the Chinese war for world domination which in the long run makes macro economic predictions
useless. Should you prep for American economic collapse or China assuming control of America? Capitalism is also a market for buying politicians.
I quit my job last year to learn off grid survival. We will very soon be entering into a global conflict a military conflict not of arms but of green agendas, cbdcs and medical interventions. Those who cannot detach from the system and live off grid will die.
They are already putting migrants in to hotels and mental institutions. Soon it will be nursing homes and all vacant commercial buildings. Tax dollars paying rent!
Cities funding Businesses in democrat areas to house migrants and thus allow them to steal billions.
Stock market is being propped up by illegals and the war for now. After that's over wait a year and maybe it will come down a bit.
when one is frustrated by failure, one must ask, why did ouya fail?
Inflation to the moon!!
Love your content George, and asing a rookie question here (18 months into a lifelong learning journey now). You mentioned it's not necessarily correlated (BTFP and SP500),but if that BTFP wasn't in place, would the liquidity disappear (because bank would collapse) and it's therefore keeping liquidity in the system and adding more for those specific banks to use?
Jack is one the best interviewers!
Wells Fargo has closed virtually every branch within a 5 mile radius of my house and I live in an huge metro area. Every time I see those empty buildings it leads me to believe they are in big trouble.
Am I the only one who always lowers the volume for the first few seconds of George's videos?
There is no risk. It's all fake. The news, the statistics, the money, the medical system, the elections, the government. You can't lose what you never really had.
Google do your job, That's the new AI programs for you
non of the banks are going to crash the proped up by the fed
Good
Goerge you hate the wef and yet you still use google. So its all talk with you?
It's unfortunate that you lack the ability to read and depend on Jeff Snider as to what to think. Here are a couple passages from Lombard Street, Walter Bagehot's conclusions of the book. JS told you "reserves" don't matter, WB would disagree.
"I have tediously insisted that the natural system of banking is that of many banks keeping their own cash reserves, with the penalty of failure before them if they neglect it. I have shown that our system is that of a single bank keeping the whole reserve under no effectual penalty of failure."
"By the last return the savings’ banks—the old and the Post Office together—contain about 60,000,000 pounds of deposits, and against this they hold in the funds securities of the best kind. But they hold no cash whatsoever. They have of course the petty cash about the various branches necessary for daily work. But of cash in ultimate reserve— cash in reserve against a panic—the savings’ banks have not a sixpence."
"These banks depend on being able in a panic to realize their securities. But it has been shown over and over again, that in a panic such securities can only be realized by the help of the Bank of England—that it is only the Bank with the ultimate cash reserve which has at such moments any new money, or any power to lend and act. If in a general panic there were a run on the savings* banks, those banks could not sell 100,000 pounds of Consols (long-term bonds) without the help of the Bank of England; not holding themselves a cash reserve for times of panic, they are entirely dependent on the one Bank which does hold that reserve."
Like I said, it's too bad you can't read.
Northman Trader is a cool dude!❄
And pumping the stock market.