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Come on...... I don’t like the Fed but they only loaned out 1.5 trillion not 16 trillion. Not counting the TALF contrivance. 1.5 trillion is the Bloomberg calculation

If you borrow $50,ooo from a bank for one year, the GAO way of calculating it would be you borrowed $50,ooo x 365 days amounting to $18,200,000

Yep, "they only loaned out 1.5 trillion", and from what I've seen they only did so for short periods of time. But they did it without any public knowledge and that resulted in this audit that Congress had to bring about. Toddsterpatriot would have us believe this is common practice but this audit reveals exactly who needed to balance their books and when. That is information not commonly made public.

I don't necessarily believe all 7 of G. Edward Griffin's points responding to Flaherty, but I think the key point is #4 inflation is the gift that just keeps on giving.

It is the reason the Federal Reserve System is coming to an end. As those of us who have read and appreciate Mr. Griffin's book know, this country has a long history of rejecting the desires of bankers.

they only loaned out 1.5 trillion not 16 trillion

In the first place $1.5T is more than "only," not counting the TALF contrivance, among the multitude of alphabet soup "contrivances that were invented to "stabilize the banking system. In the second place, and my point, the total transactional value of the FED's market interventions exceeded the GDP of the country. Now put the usual multiplier on banking system money and you discover that FED generated financial transactions exceeded "real economic" transactions by a large multiplier. (transactions involving the purchase and sale of goods and services including the wonderful service provided by federal state and local governments).

There is another way of viewing this, which is arguably not totally falacious. It is like someone who gambles every day. On any given day he might only have $1000 out on the horses and closes his transactions before taking on the next one, but if he does this every day, and if statistics work (i.e. he at least loses the bookies' fee on every transaction), his risk is not $1000 but considerably more.

Or consider the guy who drinks a quart of vodka every night. Now, he "eliminates it" quickly enough, so at any one time he is body inventory is only, say, 1/2 a pint. The guy has a problem that someone else who only does a 1/2 pint on New Year and his birthday does not have.

And I don't think analogies to drunkards and gamblers are totally irrelevant to our present economic situation.